The last time I looked, the Benjamin is still colored green. The fact that I keep a non-interest bearing Franklin instead of a Hamilton in my wallet, reserved for emergencies, reflects the state of the greenback. I remember when one GW was equivalent to 2 Philippine pesos and 360 ¥en. The peso depreciated and the ¥en appreciated. Now the Chinese ¥uan is forcibly appreciating against the U.S. dollar, taking cover by encouraging direct exchange of native currencies among its trading partners.
Coffee at the Incheon International Airport costs me less by paying in renminbi rather than the green. Four hundred Korean won was equal to the U.S. dollar when I visited South Korea in 1972. Before that, the money series reached 6,000 won to the dollar so it was abandoned. The rate today stands at 1,180 won, at par to the global value of the dollar since SoKor is unofficially the 51st State of the Union! Koreans no longer have to get a visa to enter the United States!
The U.S. Treasury at the onset of the U.S. Civil War in 1861 printed demand notes with its green color inviting trust on growth and stability. The money stayed green until 2004 when the reprinted $5 acquired purple, and the reprinted $10-50s got colorful since.
The first paper money was not interest bearing. Now banks pay a 1-percent levy to use the medium of exchange, passing on the cost to the customer, and charging interest along its projected market value in time. Thus my bank tells me I can use $3,000 of their funds and I pay them $60 per annum for that privilege, $55 last year. Then they slap additional interest on my purchases. Depending on one’s credit rating, that interest charge can go as high as a third of the value of one’s consumption.
A large section of the U.S. economy is based on financial services, managing the currency flow that denotes the exchange between assets. Two centuries ago, we were a resource-based economy, dependent on what is derived from the utilization of natural resource. Cotton was the supreme commodity in the U.S. South.
Industrial U.S. North manufactured goods. It also discovered faster capital formation in the acquisition of real estate, particularly those owned by others. The Native Americans, denied rights to their land and disenfranchised from their natural resource, went the way of extinction. Banks and a war machinery legalized larceny. War as a perpetual stance, whether conducted to separate from King George, or to deprive Pocahontas of her inheritance, was good for business.
Coal utilization shaped the transcontinental railway as the interstate highway moved further with the manufacture of cars. Needs demanded to be met in food, clothing, and shelter. American work ethic sufficiently met them. Then we discovered the power of wants, and the world of advertising was born. We are lured to acquire things that pacify our restless feelings and anxious thoughts.
We mastered the seven seas and charted the course of aerospace. Science produced pharmaceuticals and drug addiction; factories churn carbonated sugar water. A certain soda product contained coca, which was habit-forming, but the soda company paid for Chandler School of Theology at Emory U in Atlanta! How can we complain? Now, the rest of the world litters the landscape with its plastic containers. What is at most a three-cent product, I am told, is sold wholesale at 35!
Money is on the money. Japan’s economy has not grown but it supports its population in style with the earnings of its financial assets and management around the world. Only 10 percent of U.S. labor is still in resource utilization and production. The rest are on services, particularly in the financial use of the dollar as a global medium of exchange. Waste management of consumed resource was left to pollute the lakes and rivers of China!
How can an economy be based on the means of distribution and exchange?
Easy. Establish a war cartel (military-industrial complex to Ike) that sells goods and services, supported by the speed of information technology, and one’s economy can be in place for a long, long time, give or take a tolerable margin of 5 percent unemployment!
Privately owned U.S.-dominated global corporations, a government steeped in war rhetoric, a system that perpetually manipulates our wants and needs to access our willingness to be in debt, and an image of our culture emerges. It is colored green.
A needed shift is occurring, tectonic in speed in some places, of tsunami force in others. A friend lives in a village where they have cooperative housing, and a flea market that encourages barter of goods and services. He has a heating and air-conditioning worker periodically check his house’s unit and fully loads the worker’s pickup with his garden produce each time. He has also moved his financial assets to the local credit union.
In other places, the poor gawk at the mall, shoplift from perfumed and camera-monitored Gallerias, while the desperate and the destitute resort to breaking into post exchanges, like the one in Puerto Rico. Indeed, why should there be two-tiered markets for the free and the brave?