Why Money is Not Evil

What? Of course money is evil, it’s the root of ALL evil! In fact, money is one of the most important inventions behind the rise of civilization. And a pretty good case could be made that civilization would not be possible without it. Money is good, just like the wheel is good.

These are big claims and the average world citizen would probably think them a bit alien. I believe that this is because most people are confused about what money is. People know they need it, but generally don’t like that they need it. They see lots of people doing bad things to get it, but generally want it themselves. When they have it they know they have to protect it, but people who have a lot of it are often a-holes.

Like I said, money is an invention. Ask yourself, if you were around before money existed how would you obtain an item you needed? Let’s create a scenario; let’s say you need clay pot? You would have two options, you could make the pot yourself -- which would require that you have the necessary skill, material, and tools -- or you could try and convince someone else who knew how to make pots to make one for you. The first method is really only a special case because even if you could make your own pot, there are other things you wouldn’t be able to make for yourself. On the other hand, the second method has problems as well. How are you going to convince the pot maker to make you a pot? Again there are limited options: you could threaten her (or steal from her); you could appeal to her good nature; or you could barter with her.

But the last option is really the only option that works in the long term. Think about it, if the pot maker were a giving person you could maybe convince her to make you a pot once or twice, but it would get old fast. And if you used threats or theft, that may work once or twice but soon you’d find yourself being chased out of town (unless you’re the government – but that’s a different story). Invariable, you’d find that at some point you’d have to start trading.

But what are you going to trade with? You’d have to find something that the pot maker wants and values as much as the time, energy, and material that she puts into making a pot; but the odds are that you won’t have anything that you are willing to give up that fits the bill. You could try working for it -– give up some of your time and energy -- but the pot maker may not need this either. So what do you do? You’d probably have to go and find someone else who has something that the pot maker wants and barter with her first - but again, the odds are that she won’t want anything you are willing to give up. This is a problem; the web of transactions necessary to procure a pot could become pretty complicated.

So how did people get along before money? In a sense they didn’t, because they already had it. Let’s say that you do happen to have something of value to trade with, lets say you have a bronze axe. In fact, let’s say you know how to make bronze axes. Now the pot maker probably already has a bronze axe and won’t be too keen on trading a pot or two just to get another one, but she knows that a bronze axe is fairly valuable and something that other people may want. Even though she doesn’t need it herself; she would probably be able to trade it later for something she does want. To her the bronze axe is not an axe but a store of value. This is a key aspect of money.

But there’s still a problem. The axe takes more time, skill and effort to make than a pot and there are fewer of them around. You probably wouldn’t be too happy trading one of your prized axes for a single pot, an axe may be worth many pots. But let’s say that you want more than just a pot, you also want some grain and some beer as well. And let’s say that, all together, it adds up to the value of a single axe. But these things likely come from different vendors so how are you going to work out the trades? Obviously you can’t trade pieces of an axe so what do you do? Well, what you do is realize that the bronze ingots that you use to make your axes are used by many others and are recognized by most people as having value. So instead of offering to trade an axe, you offer to trade some of your ingots for the pot. And because the pot maker knows that she can probably trade ingots with a bunch of other craftsmen, the two of you make a deal. You’ve invented money!

That’s what money is. It’s a portable tradable store of value that is recognized as such by a community of people and its’ role is to lubricate the transfer of value between people. And the value that money stores is created by someone’s skill, work, and time (and risk - but I’m ignoring risk in this post). At the root, it’s as simple as that. Without it, most of today’s professions would be impossible. Without it, I would have to trade my programming skills for food and how many farmers need programs written for them! The friction of trading without money alone would put a sever limit on just how civilized a culture could become.

So why do a lot of people think that money is evil? I believe the reason is that while money itself is very good, it makes it much easier for evil people to steal the value that others create. A thief would be much less tempted to steal a pot – a big item carrying little value -– than to steal a bag of ingots. Most of the evil surrounding money has to do with fraud and theft in one form or another. And the possession of a great deal of money, especially when it is obtained without providing any value in return (e.g. through inheritance), does seem to encourage bad behavior in people with poor character – but that’s the topic of a different post.

If you are an honest person, then money to you should be about the value that you yourself can create with your time, effort, and skill. If you are not making much money, then one of these three elements is lacking. If you are making money without providing time, effort, and skill than you are co-opting someone else’s time, effort, and skill. Survival has always required the application of time, effort, and skill and our survival became much easier when we gained the ability to trade the value we create using money.
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Hydrogen is not an Energy Source

Many people believe that hydrogen is an alternative to fossil fuels for powering our society. They believe that because hydrogen powered engines produce little or no CO2 and are not based on fossil fuels we can solve two problems with one technology: the problem of CO2 emissions and the problem of our dependence on foreign oil.

This is not the case. It’s true that the element hydrogen, when combined with oxygen, produces a large amount of energy – it’s what puts the space shuttle into orbit. The problem is that just about all the hydrogen atoms on earth are bound up with other atoms in the form of molecules. To use hydrogen as a fuel it must first be liberated from molecules and this liberation takes energy. In fact, because of unavoidable inefficiencies, it takes more energy to produce useable free hydrogen than is recovered later when the free hydrogen is combined with oxygen.

What does this mean? It means that on earth, hydrogen is not a source of energy like fossil fuels are. Instead, hydrogen is a means of storing and transporting energy. A tank full of hydrogen used to fuel a hydrogen-powered vehicle is more akin to a battery in an electric vehicle. Instead of a power plant filling up a battery with electrical energy, the power plant is used to produce free hydrogen, which is then collected and used to fill a fuel tank. The power needed to produce free hydrogen comes from the same place the rest of our power comes from, in the U.S. (year 2000 estimates): 69% fossil fuels, 15% hydroelectric, 14% nuclear, ~1% all others (including wind and solar).

There is one caveat of course; this all pertains to obtaining energy from hydrogen when used in a chemical reaction. Hydrogen is a potential source of energy as a fuel in a nuclear fusion reactor – hydrogen fusion is what powers the sun. But, unless there is some breakthrough from out in left field, nuclear fusion reactors are still a long way off and so is hydrogen as an energy source. ... Continue

Scientific Consensus as Persuasion

In my previous post I talked about scientific consensus being irrelevant to the process of science. So the question is, should scientific consensus be irrelevant to us as well? The short answer is that if there’s a true consensus, the consensus opinion should carry some weight as a point of persuasion. It would be silly for a person who isn’t an expert in physics to walk around denying the theories of General Relativity or Quantum Mechanics. And, while it’s a logical fallacy to say Quantum Theory is an accurate description of reality just because every respectable physicist I know thinks so, as a point of persuasion it’s pretty darn good.

Having said that, it’s important to realize that all consensus are not equal. Some, like those surrounding the theories of General Relativity and Quantum Mechanics, have been around a long time and have survived enumerable experimental challenges. On the other hand, the vast majority of scientific belief is based on incomplete understanding and over time these beliefs, many of them a scientific consensus at some point, have been proven to be false. A wise person would not give a relatively new scientific consensus about a relatively new theory as much persuasive weight as they would an established and well-tested theory like the General Theory of Relativity.

It is also important to realize that true scientific consensus is hard to come by. Journalists and politicians are quick to claim scientific consensus as they seek to persuade, but it is very hard to establish if there really is a true consensus on a given topic. We could attempt to poll the scientific community and obtain a snapshot of what scientists believe but what would that tell us? What if 80% of scientists think one thing and 20% think another? How tied are these 80% to their beliefs and what part of the 80% really know what they are talking about? How many in the 80% have funding that depends on certain lines of investigation where the consensus opinion is assumed true? What if some of the contrary 20% are top people in the field in question? One could claim a consensus but would it be true consensus?

The last thing to realize is that scientific consensus is volatile. One solid experiment or observation that produces results contrary to a theory and the consensus behind that theory would probably evaporate. The theory in question may still retain some support but a majority of scientists would switch to a position of withholding judgment or even skepticism – the natural state of a scientist.

Regarding the theory of Global Warming due to greenhouse gasses. If there really is a scientific consensus, it definitely falls in the category of a new consensus about a new theory and as such should not be given much weight yet. And frankly, given our current relatively poor understanding about many of the processes involved in climate change, I seriously doubt there is a true consensus among scientists. I think what we really have is a consensus among politicians and journalists. There just isn’t enough solid science behind the theory of global warming yet for anyone with a naturally skeptical bent to be that tied to the theory. There certainly isn’t a consensus among the scientists that I know. ... Continue

Consensus is not Science

We often hear the term “scientific consensus” these days. The word “consensus” means that a group of people is in “general agreement” about some proposition or belief: I quote “general agreement” because the definition is fuzzy about just how many dissenters there can be within the group. For scientists, this proposition or belief usually concerns the validity of some theory and the term scientific consensus means that there is a general agreement among scientists that a theory is the “leading” or “best” theory. An example usage would be, “The scientific consensus is that natural selection is the prime mechanism for evolution”.

But science itself is not about consensus; science is about discovering and describing reality. Reality is what it is regardless of what theories exist and who believes these theories. Scientists know this and have developed a method, the “scientific method”, to go about validating theories and grounding them in reality. And the scientific method does not make any use of consensus. The scientific method is about testing theories with experiments, investigation, and observation. This is done over and over, by different people at different times, with greater and greater accuracy. This process continues even when just about every scientist believes a theory to be “good”. As an example, there are still experiments today testing the theory of general relativity, even though after almost 100 years of experimentation, no experiment (after repetition) has shown a contrary result. Consensus has nothing to do with it.

So if science is not about consensus why do we see the term “scientific consensus” so often? The answer is that consensus is a political word and it is used for political purposes. When used in the public arena, the term “scientific consensus” is used to try and persuade others that some belief is true and that some action is needed: usually a regulatory action or a funding decision. When you hear this term used in the media or in the public arena you can be sure that the writer or speaker is making or refuting a political point or trying to sell something. Even a scientist talking about consensus in a public forum would be speaking as a politician or salesmen, not as a scientist. The reason is that any scientist would know that no scientist would base her scientific judgments on anything other than the scientific method.

Lately, we've seen the term applied to global warming. Al Gore and others would like to persuade us that human activity is causing global warming which will likely lead to catastrophic consequences for life on Earth. To this end we are told that there is “scientific consensus” and that the “time for debate is over”. For any real scientist engaged in science, the first statement is irrelevant and the second ludicrous. Even if a scientist agreed with the anthropomorphic theory of global warming (as many do), she would never say that other theories shouldn't be explored or that her theory doesn't need to be tested. And if she was a good scientist and her favorite theory didn't agree with observation, it wouldn't make one bit of difference that there was a consensus behind the theory, it would be time for a new theory.
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