Tuesday, November 23, 2004

Cross of gold

James Surowiecki has an interesting article in the latest New Yorker about gold investors, and about what cranks they are in a post-gold-standard world. "If you invest in gold, you're basically betting that someday a greater fool will come along, who thinks gold is worth more than you do." That pretty much sums up the fate of a "commodity" that has virtually no utility, whose historical function was to embody an entirely hypothetical value, to encapsulate the process of exchange itself. Like words to a post-structuralist, gold has no stable meaning, it only acquires one after the fact, it is always in the process of becoming what it is supposed to be worth. But investing in gold was a way to purchase the notion of exchange, entirely independent of use value, while thinking you are doing the precise opposite, getting something of ineffable worth that transcends market fluctuations. Gold investors want pure theoretical value, value so perfect it can't be exchanged for anything; it absorbs all possible exchanges within itself and negates them. Gold is literally god, the transcendental signifier, the touchstone on which all other values are based.

Of course, various efforts have been made to establish the source of gold's value. When classical economists hit upon labor as the source of value, they argued that the difficulty of mining gold, the amount of labor required, gave gold its value. Smith suggests metals made for effective currency because they weren't perishible, and they could be spilt up and rejoined as one pleased. The physiocrats at least had a kind of logic for fetishizing land: it turns one seed into much fruit. But gold, is presumably placed on Earth in finite supply by God, which creates a zero-sum game with the ultimate value of things. You need to acquire as much of it as you can, because then you have a greater percentage of the total possible wealth. Of course this is absurd, but it's easier to grasp than the drive for perpetual growth, which constantly undermines the value of what you've worked to acquire.

Gold allows for the fantasy of value without labor, of usefulness without effort, of a truly benificient God, a pre-fallen world where no labor was required to make things valuable. It allows us to indulge that dream that value inheres in things themselves, and not in what we think of them or do with them. It allows us to indulge a splendiferous passivity.

And let's not miss an opportunity to quote William Jennings Bryan's immortal words: "Having behind us the producing masses of this nation and the world, supported by the commercial interests, the laboring interests, and the toilers everywhere, we will answer their demand for a gold standard by saying to them: You shall not press down upon the brow of labor this crown of thorns, you shall not crucify mankind upon a cross of gold."

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