It’s time we made money do what we want, rather than letting it diminish and degrade us
Money, what is it good for?
Money, what is it good for? Photograph: Getty Images
The house across the street has just gone on sale for £850,000. A bog-standard, late-Victorian, ex-council terrace house in the rough part of Islington, with a yard billed as a garden, costs as much as a street in Middlesbrough or Stoke.
When Marx wrote, in his Economic and Philosophic Manuscripts of 1844, that money “is the visible divinity” involving “the transformation of all human and natural properties into their contraries, the universal overturning and confounding of things: it makes brothers of impossibilities”, he wasn’t predicting how the north London property market would heat up in 2013, but he was unwittingly prescient. What has happened to our moral and social values? Could they be more detached from monetary values? Or, hideously, are they accurately expressed by what money can buy?
Our task in 2014 is to stop this madness, get a grip on money, put a chokehold on Marx’s visible divinity and make it do our bidding rather than what it’s been doing for the past year: confounding, diminishing and degrading us. It’ll be an unequal struggle: in this contest with the divine, we’ll be like Jacob wrestling the angel.
But the imperative to resist our corruption by money has never been stronger. If our values are expressed by what money can buy, those values have gone nuts. In Harrods’ new Fragrance Room you can buy a 7kg, faux-zebra-skin-wrapped candle scented in patchouli, cinnamon and candied lemon, “with spicy and woody notes which are subtly savage and masculine”. Can candles smell savage and masculine, you ask? Probably not, but that’s not the point. Aren’t fur wrappings for candles a fire hazard? Probably, but again, not the point. Guess how much it costs: £599. Just the thing for all those blackouts that’ll happen if Ed Miliband ever gets elected and fails to nationalise gas and electricity suppliers (as he should lickety split). At the other end of the scale, I was scandalised this summer that I couldn’t find a Poundland or a 99p shop in Tenby. They’d been replaced by £1.20 shops – all the better to seasonally exploit, or so I theorised, tourist muppets like me.
Back to the property market. Who can afford £850k? Not the few council tenants who remain in this asset-stripped, right-to-buy-ravaged street. Certainly not those subsisting in increasing numbers on food banks, those who can’t heat their homes or buy food because their budgets have been clobbered by the bedroom tax. Not even the hypocritical, owner-occupying locusts (including me) that swooped in during the aftermath of Thatcher’s deracinating, spirit-crushing, community-wrecking property liberalisation.
Of all the piquant stories dramatising how in 2013 we have lost sense of our values, how money has not just corrupted us, but got away from our comprehension (think: the Saatchi household’s unread five-figure credit card bills, the Co-op chief underestimating his bank’s assets by tens of billions, the real world tragicomedies of the Bitcoin revolution), none has seemed more personally relevant to me than this. This is a country of houses that scarcely anyone can afford. We have become degraded bit-part players in a street theatre of cruelty in which we are daily diminished by the prices of things we can’t afford.
Many of us are unwitting monsters of conspicuous consumption, walking around with £500 iPhones or £270 Beats by Dre headphones, often through areas where consumer durables like those are not so much must-haves but never-will-haves. When a poor kid stole my iPhone in the street earlier this year, part of me got the theft equivalent of Stockholm syndrome – I felt that I deserved it. Which, as he told me during a restorative justice session months after his conviction for theft and robbery, I didn’t.
As if to clinch this point about cruelly monetised street theatre, a two-bedroom house recently went on sale in London’s West Hampstead for £300,000, billed as the cheapest freehold house in central London. Around 90 prospective buyers jammed into its little rooms, a queue formed outside and estate agents acted as bouncers – evicting prospective purchasers as if from an exclusive club. Which is what the property-owning class is. “The level of desperation is still there as the severe housing shortage in the city hasn’t yet been solved,” Lois Fort, head of residential lettings at Dutch & Dutch said.
We live in a country where you can run, but only pointlessly dream of catching up, where the majority of the poor (according to the latest government statistics) aren’t the kind of people whom Iain Duncan Smith wants to terminate for the public good, but in work.
I say “we”. Let’s not get too pious about what the confusion of money has done to British society. We’re not all in this together, despite what David Cameron says (“Never,” as Arcade Fire sang, “trust a millionaire quoting the Sermon on the Mount”; never, they could have added, trust an Etonian plutocrat expressing solidarity with Cardboard City). Oh baby, I thought, as I clicked through the online photo gallery of the house for sale opposite – it’s £300k more expensive than the last house to sell in this street! Our house may be worth as much! If not more! We’re rich beyond our wildest dreams! By doing nothing! Or maybe not. Let’s not go crazy: it hasn’t sold yet.
Money has always been thus – whimsically making and unmaking fortunes, chucking out largesse irrespective of merit or desert and producing laughably misplaced expectations. Only now it seems more perverse, less graspable, wilder in its dispensations than ever.
Oscar Wilde once said: “Nowadays people know the price of everything and the value of nothing.” Today we continue to know the value of nothing, but we don’t know the price of anything either. We’ve got used to government ministers not knowing the price of a pint of milk, of David Cameron batting away inquisitorial probing about the price of a loaf by replying he prefers to bake his own in a bread maker, thanks very much.
Now we’re getting used to more spectacular examples of monetary ignorance. When Paul Flowers, the disgraced chief executive of Co-op, appeared before the Commons treasury select committee and estimated the value of my bank’s assets at £3bn (not far off, Reverend Flowers: the actual figure is £47bn), I wasn’t sure how to feel or what to do. Was his evident grasp of the street value of ketamine, crystal meth and coke consoling in these circumstances for his customers or, you know, not? Should I transfer my overdraft and joke pension to First Direct (whatever that is) or convert it into Bitcoin currency (ditto), squirrel it away into offshore funds (whatever that means) or just hang tough (ditto)?
I did nothing, but felt heartened by Flowers’ on-trend confusion – he was a kindred spirit, one confounded by money. Just a shame that his job description implied a competence at managing it. Mine doesn’t, which is just as well. Whenever I’m asked the great imponderables – how many texts on your phone package, how did the Higgs Boson particle confer mass on the early universe, what’s for tea – it’s always the financial ones that drive me to make wild stabs in the dark like Flowers. How much does my mobile phone cost a month? Five pounds. Maybe £85. One or the other. I haven’t got a grip on the stuff that’s haemorraging from my current account. All I do know is that life is too short to spend time on comparison sites working out which of E.ON or npower proposes to rip me off less. The free market lie-dream of making capitalism work by developing informed choices about things (phone tariffs, gas bills, primary schools, hospitals, and – please God no – cars) that differ only fractionally isn’t what I was put on this Earth for, whatever the government and Martin Lewis of moneysavingexpert.com say.
And I’m not alone in this. Many of us have become small-time Charles Saatchis. Among the many unpalatable things the millionaire art collector told Isleworth Crown Court during the trial of his and ex-wife Nigella Lawson’s two assistants was that he didn’t check his credit card bills. Like many of us, he values the time spent sitting in his pants eating beans from a tin pining for his departed domestic goddess much more than the nightmare of putting his finances in order. The only difference between him and us is that it doesn’t matter if £76,000 a month is floating unnoticed out of his purview, while we get kneecapped by hired thugs if we don’t repay payday loan companies the 50 quid we’ve borrowed on time (in so far as I understand their business models).
Spending has never been so easy, or so perilous. 2013 was the year that the bank issued me with a wave-and-go card. You hold it near a card reader, wave it like the Queen acknowledging her subjects from a limo, and suddenly you own seven flat whites you don’t remember ordering and you’re on a list somewhere saying you’re no longer creditworthy. That’s why, no doubt, there’s a £20 limit on such contactless purchases – otherwise, I’d bring the banking system to collapse for a second time.
But, if you believe such Panglossian penseurs as Niall Ferguson, such financial innovations as contactless cards, PayPal, virtual currencies and replacing workers with self-scanning machines are handmaidens to human progress. “Far from being the work of mere leeches intent on sucking the life’s blood out of indebted families or gambling with the savings of widows and orphans, financial innovation has been an indispensable factor in man’s advance from wretched subsistence to the giddy heights of material prosperity that so many people know today,” argued Ferguson in The Ascent of Money.
And the pub in east London where you can buy beer with the virtual currency Bitcoin, that is – somehow – part of that ascent of money? It is, argue enthusiasts, money by and for the people, a currency that arrived in 2009 at a time when trust in bankers was, as we all know, not buoyant. And it is possible to make real-money fortunes from Bitcoin that can be expressed in bricks and mortar. For example, four years ago Kristoffer Koch bought £22 worth of the virtual currency, which is usually used for online transactions. Such is Bitcoin’s volatility that his investment, which he had forgotten about until reading reports of its rise in value last year, was worth $850,000. He cashed a fifth of that fortune in order to buy an apartment in one of Oslo’s wealthier districts.
I know what you’re thinking. “Oslo? Sheez. No way I’m living in Oslo when I’ve made my fortune from speculation in a currency I don’t even understand. Have you seen how much a beer costs there?” But that’s not really the point. The point is that Bitcoin is a virtual currency sustained by a Ponzi-like belief that it is not worthless, and unbacked by the banking sector, gold or any of the established underpinnings of monetary value. For those of us whose first experience of money was using halfpennies and threepenny bits to buy gobstoppers and pea-shooters (stop looking blank, younger readers), such a mutation is hard to understand – unless, that is, we accept the truth of what a banker explained to me this week, namely banking is, has always been and always will be a confidence trick.
James Howells was less fortunate than his Norwegian counterpart. Last summer the British IT worker chucked out his computer hard drive. Only one problem: it turned out that it contained the cryptographic key he needed to access a digital wallet containing 7,500 Bitcoins which, he realised probably with a tremble in his otherwise stiff upper lip, was worth £4m. He hadn’t backed up his hard drive (we’ve all been there, right?). His story is the 2013 version of a bank robber’s millions blown across fields from a moving train with the twist that nobody, not even children otherwise unoccupied during the school holidays, is going to find Howells’ fortune. That said, virtual fortune hunters are reportedly rummaging through the landfill site where it ended up. They, like Captain Oates only more so, may be some time.
If our task in 2014 is to get a grip on money, here’s one little attempt. The other day I went to the shop with a notepad and a daughter. My eight-year-old’s homework task was to note down the prices of things and put them in order. As often happens when assisting with primary-school homework, I learned more than she did. I thought it was she who was living in a disadvantaged monetary fairyland where, because of the advent of the cashless society (across Europe now only 9% of transactions take place in cash; in the US it’s 7%, according to Daniel Conaghan and Dan Smith’s The Book of Money), she would struggle to know how much basic things cost since, unlike me, she had never had to count out the price of them in coins of the realm.
But it turns out that I am the greater financial ignoramus. Did you know that a pint of semi-skimmed milk is 49p? That you can buy a banana for 19p? How much the Saturday Guardian costs? Me neither. In an increasingly cashless society where we punch out our pin for sums that scarcely figure in our consciousness, it’s easy to spend money without realising it.
Money has become for us what beer was for Homer Simpson – the cause of and solution to all of our problems. Can we make it just the solution? It seems unlikely.