Paul said in [1951],
This social guarantee is now provided by something else outside,
the domain of private contracts - the state bank. It is able
to enforce its guarantee through two mechanisms:
1. The private contractors have to have recourse to the courts
to settle disputes over contracts, and the state may legislate
to the effect that its paper has to be accepted in payment of
any debt.
2. The state has the power to tax, and, this taxation now absorbs
a very large part of the social product. If it levies taxes in
money rather than in kind, it can enforce the circulation of
its money. This was an important means by which state money was
introduced into Africa for example. The colonial governments levied
taxes that had to be met in the notes and coin which they
issued.
The important factor though, is that private contracts by themselves
can never be the foundation of a banking system. This I take to be
the import of Marx's accounts of how in a commercial crisis,
endorsed bills which had been accepted as means of payment,
ceased to function as such, and the cry went out for settlement
in gold.
Chai-on:
Thanks. Now we are getting closer to each other.
The outsider's intervention is a prerequisite for the so-called e-money.
It is issued as a kind of tax and yet is circulated as a commodity, as a
labour product within the group of commodity producers, because they earned
the e-money with labour. For the outsiders, however, it is produced from
nothing. For us, it is exchanged with our hard labour. So, as far as the
commodity producers are concerned, the e-money is still a labor product.
Does it have an intrinsic value then? No, I do not think so. It is
ascribed to a value by force. Outside the political boundary, it loses the
value.
Money is, therefore, in the articulation of politics and economics.
Moredetailed discussion should follow.
Yours
Chai-on