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Money: Good or evil?

It seems like almost everyone has heard the phrase “money is the root of all evil” during their lives. There are a lot of people who believe that statement to be true. For such people, they suffer from two misconceptions. First, this phrase is only part of the context quoted in the Bible in 1 Timothy 6:10 (King James Version). Second, money in and of itself is neutral. However, the creation of “money” has facilitated much good in history right up to today.

The actual quote attributed to the apostle Paul is “For the love of money is the root of all kinds of evil.” When put in full context, you can see that money is not itself attacked. Instead, what is knocked is a human’s desire to obtain money, and for some people who value obtaining money as a high priority to the detriment of other values such as family, friends and community.

As for money being the root of a lot of good, that needs much more explanation.

Have you ever considered how the concept of money originated? There is not a clear cut answer to that question, as it depends on how you define the term.

The classic textbook definitions of money included its use as a unit of exchange and as a store of value. Many physical things have been used as money over the centuries, including obsidian, grains of rice, cowrie shells, cattle and other animals, stones and finally metals – especially precious metals.

There are indications that cattle and grain may have been used as either barter or money going all the way back to 17,000 B.C. – and definitely by 9,000 B.C. Obsidian was used in Anatolia, approximately the western two-thirds of the modern day Asian part of Turkey, as early as about 12,000 B.C., where it was exchanged on an organized basis starting about 9,000 B.C.

The origins of money likely evolved out of bartering, which involves the direct trade of goods and services between two or more parties. Barter was limited to circumstances where there was a coincidence of wants, where all parties to a transaction wanted what the other parties wanted to trade. Barter proved to be tremendously inefficient.

To overcome the inefficiency of barter, the need for a practical means of indirect exchange was needed. This became even more important as the division of labor helped people increase their wealth.

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As barter turned into the use of money, the first objects tended to be items of everyday utility such as livestock and food. However, such items had the drawback of being perishable. Over time people understood that desirable attributes for something to be used as money needed to be valued for its own sake, durable, portable, measurable and consistent. Of many materials, metals eventually became the money of choice. Of them, gold and silver became the units of money because of their value as a commodity.

Gold bars were used for exchange in Egypt around 4,000 B.C. By 3,000 B.C. the shekel was in use in Babylon, which was defined in value for a specific weight of either barley, silver, bronze, or copper.

By facilitating the division of labor, where people were more productive in specific endeavors rather than being required to be skilled at all aspects of survival, money made it possible for people to engage in indirect trade. A farmer could exchange foodstuffs for other necessities of life, no matter what the goods or services might be. The people who received money could then trade it to satisfy their wants and needs. Thus, money was an important element in global economic development and reduction of poverty.

Now, if you wanted to take a light-hearted approach, I don’t know many people that love money for its own sake.  Instead, it seems that as soon as they get it they try to get rid of it as soon as possible to obtain goods and services.

To summarize, the creation of money facilitated growing wealth for humanity.  When used for these purposes, money has provided a great benefit to people for thousands of years. The fact that some people sought to obtain money through evil acts such as coercion or fraud does not in any way make money itself evil.

Patrick A. Heller was the American Numismatic Association 2012 Harry Forman Numismatic Dealer of the Year Award winner.  He is the owner emeritus and communications officer of Liberty Coin Service in Lansing, Mich., and writes “Liberty’s Outlook,” a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at http://www.libertycoinservice.com. Other commentaries are available at Coin Week (http://www.coinweek.com).  His radio commentaries titled “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 a.m. Wednesday and Friday mornings on 1320-AM WILS in Lansing (which streams live and becomes part of the audio and text archives posted at http://www.1320wils.com).  

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