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By many modern definitions, some stated and others observed, prosperity is simply the state of having more. Often enough, the barometer is money. More money. Prosperity is having more money. If you have more money than someone else, you are more prosperous than [s]he is. Intangible factors, seemingly, are deemed irrelevant and only material wealth is measured, perhaps because it is measureable. Why do we need more? The answers to that are varied: some systemic, others detrimental, and some avoidable. The short answer is: that’s what was agreed upon generations ago.
Money, currency, was invented as a tool to replace the barter system. Money was a standard object that could be traded for anything and everything, as opposed to being rejected for what you had to trade with. In this sense, money was a good invention as it made goods and services accessible to all. Ideally, money would flow from one person to another for goods and services provided. Prices would level out in the end when all factors [time, rarity, etc] would be taken into account and in the end: it would function as if everyone received what they needed for free due to the even flow of money from one entity to another. Perhaps, small communities and systems long since past operated in such a way. We know, in the world we live in, that such balance is not achieved.
Systemically, all it would take to unbalance the system is for any of the entities in the flow of money to be unbalanced. If one entity hoards the money they receive and do not spend it, then eventually there is less money in the system and conflict arises. If one entity raises their prices arbitrarily, taking advantage of the situation, then the flow of money has also been disrupted and eventually conflict will arise. The other entities may be forced to raise their prices accordingly to reinstate equilibrium. The difference is those wishing to join the system or those that require assistance are at a disadvantage, an unnecessary disadvantage. We can see, in the world we live in, the anger and frustration at those who earn more than their perceived worth. The frustrations are amplified when the entity drawing the wealth is not adding value back to the system.
When multiple systems exist, the equilibrium must be expanded and re-calculated. When one, or more, systems feed another without receiving the same in return: it is only a matter of time before the feeding system runs out and the recipient system loses that source. To avoid conflict, and to believe in the idea of prosperity: the price paid and the goods/services received must be equal in perceived value. This includes micro-transactions of children with lunchboxes or toys up through gift purchases and large-scale investments. It also involves taxes, fines, fees, tariffs, and all related devices. While not necessarily money-related, individual’s roles in relationships must also provide value else the system [relationship] fails. Money, worth, value, must return to the investor for the system to work.
So how much is money worth? This is a question likely asked by each and every generation since the invention of money. In our world, some people make their living off of the fluctuations of currency: trading back and forth when conditions are favorable. If we do a basic thought experiment we can see that money is worth less now than it was then, and is worth more now than it will be later.
Let us say that there are 1000 people in an economic system. Each of these 1000 people has 10 dollars. This system has achieved pure equilibrium, and everyone normally has 10 dollars. We will call this a value of 1. Now, let us say that the people in the system have children and those children are now of job-seeking age. Now we have 1500 people in an economic system. In order to maintain the value of 1, each person would now only have 6 and 2/3 dollars. To ensure that everyone has 10 dollars, more money would have to be created. The newly created money devalues the existing money. Everyone now has a value of .66 instead of 1 and all goods/services are more expensive to reflect the decreased currency. So population increases lead to two choices: 1) everyone has less money or 2) money is worth less. While neither side is popular, option 2 seems to be chosen more often than not.
Now, let us say that in the 1000 original people, 100 are able to hoard and not add value. Over time, those 100 people amass so much wealth that the other 900 have decreased standards due to decreased net worth. The 100 have most of what they need, short of food and such, and do not need to spend much, forcing conflict with the other 900 due to lack of equilibrium. More money is created to enhance the 900, reducing the value of the other 100 and causing a different conflict. In both cases, a conflict is caused but in the latter scenario, the majority is happier at the expense of those that disrupted the system originally. Now let us add population increase, and we have two causes for a devaluation of existing money.
The 100 finds people willing to live poorer than the 900 they have locally. Most of that expenditure now leaves the system entirely, from the perspective of the 900. Some of that 900 are now jobless as a result and a drain on the system [through no fault of their own]. The 100 make more money while contributing even less to the original system and the 900 see no sign of improvement. Some of the 900, now jobless through systemic greed, are not only a drain on the system through social assistance but are developing the desperation needed to make the scenario even worse. Now the currency is being devalued due to: 1) population increase, 2) removal of money from the system by the 100 to be sent elsewhere, 3) removal of money from the system by the 100 to hoard, 4) the jobless section of the 900 no longer contributing and 5) efforts by the 900 to restore their former value.
Please also keep in mind the above does not even factor in natural disasters, war, poorly run governments, or crime. Any and all of the aforementioned could, and often does, have an impact on the worth of the money in a system. In a globalized world, each system is woven in such a way where errors made in a different system still could have a dampening effect on yours in a real way.
The question now gets asked again: What is money worth? That depends on where and when, but probably less than what it once was. Can the continual decrease in the worth of money be prevented? Even if the economic system ran with actual equilibrium, population increase alone is still a concern. So the answer, from a pure worth perspective, is to make more money at the same rate as the same money devalues. If the worth of a dollar decreases 10%, make 10% more. If that was to be accomplished, true worth would stay the same. The numbers would change, but the value would not.
The problem, though, is that if you make 10% more then someone else has lost the 10% you made. If one continually strived to maintain their original value of 1, they would actually be gaining at the expense of others because the entire worth of the system is not staying at the original value of 1. If the entire system becomes a value of .66, your extra .33 costs someone else a .33 in return.
So who owns money? Well, we do. However, we don’t own it in the conventional sense of “this valuable substance is mine.” We, the collective we, own it because money is created from our debt. Money is a public resource. Most of the money is simply created from banks when we sign a loan agreement, through the fractional reserve system. The debt can be bought, sold, and exchanged for central bank money. Banks do not loan the money they have from deposits, they actually just create it from our debt. A minor percentage of money is created by the Federal Government, but that too is just a loan from the Federal Reserve, a.k.a. more debt. Money is debt. Since the debt is ours, the money is ours. My dad likes to say “Don’t worry, it’s just money: they’ll print more.” He is right, even if his intent/implications are different. There is an anti-socialist philosophy that goes something like “the problem with socialism is that eventually you run our of other people’s money to spend.” What other people’s money? Are we now spending their deposits? No. We are spending our debt. It is a fundamental difference in perspective. If we understood money to be a public resource, owned and created by us, perhaps we would treat it differently. If we treated money differently, perhaps we could treat each other and our environment differently as well.
What does it mean to be prosperous? It means to gain at the expense of someone else’s loss. There cannot be ‘rich’ unless there also is ‘poor.’ If everyone was ‘rich’ then the meaning of the word is lost. However, like it or not, the pursuit of wealth beyond ones needs is not going away. Short Sellers and other people who make money without contributing goods/services of value are here to stay. Greedy hoarders are here to stay. Mindsets that everything should be a for-profit entity, like education and health care, will only continue to make it more difficult for most to obtain either.
What does it mean to be prosperous? It means making money at or above the rate of decay in the value of the money your making. It means taking more than you give. It means removing more from the system than you add back to it, to disrupt the equilibrium. To be fair, if there ever was an equilibrium it was destroyed long before any of us were born. In the world we live, to a certain point, to take is to survive. Emergencies cost fortunes, and dreams are continually delayed. The wealthiest have more than they ever need and the poorest have trouble with food and shelter; at the same time one side is growing in wealth exponentially and the other side will have it more and more difficult to try to catch up. Finding a dollar on the side of the road didn’t mean what it used to. Our failure to see money as a public resource directly harms the public itself.
Money was never meant to be hoarded, but until we all stop doing it [simultaneously] it’s an unfortunate reality (*a). What does it mean to be prosperous? Stop looking at your wallet and instead look within and you might find the answer is cheaper than what you originally thought it might be. Money is a part of our lives, but there is more to life than money. Find the balance between enriching your lives with new things, and being happy with what you have. Live within your means and save for that dream of yours.
What does it mean to be prosperous? It means taking from the system, giving back to it, and making the most of this system we call life through the pursuit of dreams and the enjoyment of one another. We can’t all be rich, but we can all be prosperous.
(*a) I am not implying that everyone should spend every penny they bring in. Saving for goals, dreams, and emergencies is a good idea. Hoarding for the sake of hoarding, however, is not a good idea. Hoarding at the expense of others is not a good idea. In 2007, the top 10% wealthiest owned 80% of all financial assets. I’ll say that again. 10% owns 80%. On a related note, 21.6% of children in our country do not have a stable access to food. How expensive would it be for the wealthiest country in the world to feed its own citizens? Some say: too expensive. What do you say? Who owns money, and where should we spend it on?