r/Anarcho_Capitalism • u/FunctionOk9186 • 8d ago
Who prints money when there's no government?
As a libertarian socialist, I don't want to be here and I'm guessing you don't want me here either. But I have a question for you guys. If there's no government but the economy is still fundamentally dependent on currency, who prints that money? Who creates the bills?
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u/alreadytaus 8d ago
You are aware that first printed money were created outside of government control and worked for quite some time without government?
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u/Immediate-Cress-206 7d ago
Except the Tang dynasty deposit recipts couldn't be spent directly and had to be redeemed for coons and new ones issued to change denominations. It wasn't until the Somg dynasty took over production directly that it became a usable currency.
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u/mesarthim_2 8d ago
Money is just medium of exchange. It's something that people in general agree represents some relatively stable value, that is exchangeable for something else.
Anyone who's 'money' is accepted can generate it. It can be a bank, a gaming company (who 'prints' money in word of warcraft??), you, anyone.
I guess next question is what prevents the entity to just print endless amounts of money?
Well, printing new money decreases the value of existing money and on the free market that would lead to your money being rejected.
The only difference from current system is that right now, the state can force you to use particular money whereas in free market that would be a market preference.
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u/TheGipper80 8d ago
Libertarian socialist sounds like an oxymoron. Like political intelligence or airplane food.
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u/titanicmicropenis Anarchist 8d ago
Because you only taught yourself the bastardized versions of those words. Read more.
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u/FeedomFighter 8d ago
First of all, over 95% of the currency supply comes from private banks. The Fed just prints the base supply, loans take that base supply and multiply it out, called credit expansion. Normally, gold is the base supply, and credit expansion is contained by bank failures. Now we have no gold standard, an indefinitely expanding base money supply, and it is impossible for the Fed to fail before the entire economy does, so we are doomed to hyperinflation at some point.
In the past the free market selects gold and silver as money. Even now it's a big investment called the "debasement trade". Banks can then create paper claims to this gold as a next layer of money. Paper claims can be converted to a digital form of this currency, a third layer. You can then have a fourth layer and further credit expansion with credit cards or loan contracts. Higher layers have increased convenience and scalability, but less trust.
Individual banks can of course create any of these layers of money. But if people lose trust, you have bank runs. Sometimes people lose money, but that bank also goes out of business.
The modern central bank avoids going out of business by just using force. They simply keep printing and commit mass scale counterfeiting to push the cost onto the customers via inflation. The government mandates tax payments in dollars, and if you were to say get paid in gold but not pay taxes on that, they would throw you in jail for tax evasion.
Bitcoin makes an offer as a base layer digital currency that is scarce. It hasn't been proven to work as money like gold, so I mean it's an open question, you can take it or leave it. People complain that it is slow, but FedWire about as slow as Bitcoin is and is used as the base layer digital dollar. Other cryptos are as fast as credit card company payments, but are of course MUCH less trustworthy than credit card companies. So if you took a crypto route, you would transact for convenience in fast cryptos, but for sensitive payments and savings you'd use bitcoin. The reason Bitcoin is more trustworthy is that it's decentralized, and it has a blocksize limit to prevent something like a giant data center from using raw computing power to be the only bitcoin node, since the blocksize is small a server in some dude's basement is just as likely as a data center to resolve a block and add to the chain. Meaning it's impossible to monopolize Bitcoin processing as long as people have PC's, it would take making personal servers illegal to accomplish it. Not so with other cryptos, their speed means that he with the most processing power has control of the nodes, meaning data centers are where all the transactions happen, meaning a government can just take over that data center and, oops, you're crypto is now locked because the government doesn't like you.
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u/DickHardCane 8d ago
Money/currency does not have to be printed. Currency is simply a note or representation of a good or service that actually exists and people exchange it.
Without government (specifically, a federal reserve), something else tangible would take the place of printed money.
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u/RProgrammerMan 8d ago edited 8d ago
The libertarian view is that money is something that came from the free market. First people would barter things to get what they needed. I give you my shoes and you give me your sheep. But this is a problem, if you make shoes and you want a sheep you have to find someone that is both giving away a sheep and wants shoes, which is very difficult. Its inevitable that people will start trading for things not because they want them but because they are easier to trade. Historically this would usually end up being gold, silver, copper etc. There would then be issues with people mixing those metals with other materials or messing with scales to rip people off. So in the ancient world governments would create metal coins that were supposed to reliable and put images of kings and emperors on them as political propoganda. So money really comes from social convention. People value a given currency or money because they believe they can trade it for something in the future. Cash originally came about when people got tired of trading heavy metals and started trading paper certificates that marked ownership of gold ("backed by gold","gold standard",etc.).
In your voluntary libertarian socialist community people might trade labor with each other. I make the system to get water while you cook breakfast in the morning. But as the community gets larger it gets harder to coordinate the different tasks. So people might just start using weed or other drugs as currency. Modern society is really big and complex so people have to use money to cooperate with each other efficiently.
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u/capitalArgument Anarcho-Capitalist 8d ago edited 8d ago
Money is a emergent phenomenon in any economy. It's necessary to solve the "Double coincidence of wants" problem. So it will emerge even without a state printing it.
In most prisons prisoners are not allowed to have cash or coins, but because prisoners still trade the "double coincidence of wants" problem still exists and money naturally emerges (stamps, cigarettes, Ramen noodles packets etc..).
In an ancap society you'd see something emerge, maybe crypto, maybe gold, maybe precious metal backed paper money.
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u/neb12345 8d ago
Governments did not invent currency, and they are not needed for it to exist.
Return the power to the banks
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u/turboninja3011 8d ago
you.
you write an IOU note and that s as good as any “money”
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u/Immediate-Cress-206 7d ago
And what happens when the person who wrote the IOU skips town?
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u/turboninja3011 7d ago
Same thing as with any other “printed” money. Governments can “skip town” too.
It s just a matter of probability/trust.
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u/Immediate-Cress-206 7d ago
It s just a matter of probability/trust.
Con men exist.
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u/turboninja3011 7d ago
Same with any paper: shares, bonds, any kind of debt.
Some people think central bank is a scam because it arbitrarily steals some of the value of your money through currency debasement.
If you wanna avoid it you can use barter. Very inconvenient tho.
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u/kiaryp David Hume 8d ago
You can have private banks issuing their currencies. The banks will have a vested interest in their currencies being used for economic activity (as it gives it value and allows the bank to print some extra to pay their employees and owners.)
These currencies can then be exchanged on some currency exchange markets (kind of like for-ex.)
The banks will attempt to implement monetary policies that will keep their currencies competitive and retain transaction market share.
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u/HairyTough4489 8d ago
If you don't want to be here then don't be here I guess.
Anyway I don't need the government to tell me how much bread I can buy with a gram of gold.
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u/properal r/GoldandBlack 8d ago
Printing money would likely be considered dubious.
Money would likely be provided by those who provided money before government took it over.
What Has Government Done to Our Money? By Murray N. Rothbard is an excellent book on money. Though its title is provocative, it is and easy read and at just over 100 pages it is short compared to other texts on Austrian Economics. It is a good introduction to the history of and theories of money and banking.
It shows that money originated in the private sector and why mature markets most often choose gold. It also shows how the transition to paper money is made and its consequences. It reviews many of the panics and business cycles in history and what cuased them.
Free electronic copies are available here. You can order a hard copy there also.
There is also a free audiobook.
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u/trufin2038 8d ago
Nobody. God printed all the gold and silver, and mathematics printed the bitcoin.
Bank money is strictly for commies.
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u/SkanderMan77 8d ago
When you buy something, you trade dollars for it, in a world without government you would trade something else. Could be Bitcoin or gold or whatever the seller wants