Home > The Economy > Question of the week: Is special money starting to drive out universal money?

Question of the week: Is special money starting to drive out universal money?

October 22, 2010 Leave a comment Go to comments

from Merijn Knibbe

To me the remarkable thing is that the USA stops being ‘the land of the free’ as soon as it comes to the poor. One of the remarkable things about money is that, once you have it, you are free to spend it on whatever you like. People getting food stamps are not given this freedom: they get ‘special purpose money’ – which only buys food. Maybe that’s a good thing. Maybe it’s not. But it does run counter to the ‘it’s a free country’ idea. 

P.S. – aside from the increase of the use of food stamps, there is quite an increase in other kinds of ‘special purpose money’ like credit cards which only can be used in destinated shops, copy cards and lunch cards from companies, vouchers which buy education or (in the Netherlands) some kinds of care etc. etc. In the textbooks you can read that the great thing about money is that it’s an universal means of exchange. Is special money starting to drive out universal money?

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Categories: The Economy
  1. Helge Nome
    October 23, 2010 at 1:58 am | #1
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    In my opinion, the best kind of money there ever was, is silver coin. These coins have been used for thousands of years in many cultures and many have survived right up to the present. Their wear attests to their value.
    The reason why paper fiat money is used instead at present has to do with the control this gives government in regulating the amount in circulation because paper wears out rather quickly and the government can choose how much of the returned paper is reprinted. Silver coins are like birds leaving the nest. Once they leave the mint, the government has no control because these coins have inherent value, as opposed to nickel coins and paper. Viva silver!

  2. antonio garrido
    October 23, 2010 at 9:21 am | #2
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    Here is an idea. Don’t know the source, but my grandfather used to say very frecuently: “Money should be like potatoes-or other farm goods- you have to use it during the year. Not use to store them”.
    Good old grandpa…Keynesian without knowing it.

  3. merijnknibbe
    October 23, 2010 at 12:31 pm | #3
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    @ antonio garrido

    One of the most famous entrepreneurs, in the Schumpeterian sense, of the Netherlands is Henny van der Most. As a young man, he became a millionaire with the trade in scrap iron from the USSR. At the moment, he is in the ‘large scale special location restaurant/entertainment business’ (indeed, Schumpeterian ‘novel combinations’ don’t always have a proper name yet).

    Every year, he goes on a boat tour with people who have their own small business. He loves that. All they, they are talking about these businesses. Last year, the Chamber of Commerce organized a similar tour, but this time with MANAGERS. After two hours, he called his driver to get him from the boat, “all they could talk about were mortgages and stocks”.

    He went on to say the same thing as grandpa: ‘money is a tool, not a goal’.

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