Georg Simmel’s Philosophy of Money: 4. Individual Freedom

Waggish 2015-07-01

Having discussed money’s central role in (a) reconciling incompatible value systems and (b) putting quantifiable and comparable numbers on every element of those systems, Simmel finishes the first “analytic” half of The Philosophy of Money and moves on to the “synthetic part.” Having exhausted his exploration of the very concept of money, he now expands outward into larger ideas of economy, sociality, and modernity. Many of his ideas in the second half were hinted at in the first half, but are brought to much more panoramic fruition now.

The title “Individual Freedom” recalls a paradox Simmel mentioned much earlier: even as the monetary economy binds us more tightly to each other by allowing universal exchange and specialization, the individual faces a greater freedom of self-definition because their lifestyle is no longer necessarily tied to their trade. (In practice, as Simmel points out, this freedom is often quite limited for most people. What matters is the lack of a preordained fate.) Or as Simmel puts it–

Money is really that form of property that most effectively liberates the individual from the unifying bonds that extend from other objects of possession.

This is to say that in a money economy, the individual-in-society undergoes a transformation analogous to what occurred to value systems when they were reconciled through money. Humans are becoming like money, indistinguishable in number; independent and flexible at the cost of the loss of a fixed and specific identity. Just as the values lost their individual quality and character to be abstracted into the pure, quantified form of money, individuals find themselves removed from the particularizing bonds of their specific work and lifestyle as the value of those things is expressed in neutral cash. To be clear, this is not an effect of capitalism per se, but an effect of trade economy. In this chapter in particular, Simmel portrays socialism not as an opposition to capitalism but as the perfection of some of the abstracting tendencies introduced by capitalism’s fluid focus on money. As Simmel pointed out in the previous chapter, a centrally planned socialist economy would demand just as much if not more quantification of values in order to ensure fair distribution of goods and services. Socialism might in fact be the pinnacle of money’s abstraction from content to form:

The delivery man, the money-lender, the worker, upon whom we are dependent, do not operate as personalities because they enter into a relationship only by virtue of a single activity such as the delivery of goods, the lending of money, and because their other qualities, which alone would give them a personality, are missing. This, of course, only signifies the ultimate stage of an on-going development which, in many ways, is not yet completed—for the dependency of human beings upon each other has not yet become wholly objectified, and personal elements have not yet been completely excluded. The general tendency, however, undoubtedly moves in the direction of making the individual more and more dependent upon the achievements of people, but less and less dependent upon the personalities that lie behind them. Both phenomena have the same root and form the opposing sides of one and the same process: the modern division of labour permits the number of dependencies to increase just as it causes personalities to disappear behind their functions, because only one side of them operates, at the expense of all those others whose composition would make up a personality. The form of social life that would evolve were this tendency to be completely realized would exhibit a profound affinity to socialism, at least to an extreme state socialism. For socialism is concerned primarily with transforming to an extreme degree every action of social importance into an objective function, Just as today the official takes up a ‘position’ that is objectively pre-formed and that only absorbs quite specific individual aspects or energies of his personality, so a fully fledged state socialism would erect, above the world of personalities, a world of objective forms of social action which would restrict and limit the impulses of individual personalities to very precisely and objectively determined expressions. The relationship of this world to the former is similar to that of the relationship of geometric figures to empirical bodies.

Some of the issues SImmel discusses are particular to capitalist economies, but the underlying issues are far broader.

The effect of this shift toward form is the birth of the “individual” as an idealized, more discrete, yet more dependent entity, and that tension forms a back-and-forth neurosis. As we’ve seen, Simmel is very interested in dynamism, seeing it as the underlying metaphysical principle of existence:

The development of each human fate can be represented as an uninterrupted alternation between bondage and release, obligation and freedom. This initial appraisal, however, presents us with a distinction whose abruptness is tempered by closer investigation. For what we regard as freedom is often in fact only a change of obligations; as a new obligation replaces one that we have borne hitherto, we sense above all that the old burden has been removed. Because we are free from it, we seem at first to be completely free—until the new duty, which initially we bear, as it were, with hitherto untaxed and therefore particularly strong sets of muscles, makes its weight felt as these muscles, too, gradually tire.

Money accelerates this dynamic yo-yo, since we have much more ability to conceive of ourselves as free from any particular tie, even if in practice we may have difficulty freeing ourselves. Whereas in earlier societies people inhabited their economic roles in a particularized and personalized manner, the formalization of “occupation” and “job” now means that work is no longer a necessarily indelible part of anyone’s identity. Our functional roles start to appear extraordinarily contingent, leading to a vertiginous sense of being freed from the shackles of fate:

While at an earlier stage man paid for the smaller number of his dependencies with the narrowness of personal relations, often with their personal irreplaceability, we are compensated for the great quantity of our dependencies by the indifference towards the respective persons and by our liberty to change them at will. And even though we are much more dependent on the whole of society through the complexity of our needs on the one hand, and the specialization of our abilities on the other, than are primitive people who could make their way through life with their very narrow isolated group, we are remarkably independent of every specific member of this society, because his significance for us has been transferred to the one-sided objectivity of his contribution, which can be just as easily produced by any number of other people with different personalities with whom we are connected only by an interest that can be completely expressed in money terms.

This is the most favourable situation for bringing about inner independence, the feeling of individual self-sufficiency.

Simmel describes this freedom in remarkably ambivalent terms. It is very much a “freedom-from,” rather than a “freedom-to,” because it disconnects us from some of the fatalistic notions of birth and parentage of earlier societies (notably, the very fatalistic classical Greeks). Oedipus no longer has to be the king, since king-value is now expressible in monetary terms and easily can be changed into something else. This makes a much more radical notion of equality possible, since drastic imbalances are now quantifiable and, at least in theory, correctable. Class aspirations become conceivable and meaningful.

The structure of money is particularly well suited to operating as a relatively satisfactory substitute for an absent ideal major success because, by virtue of its tangibility and its quantitative determination, it provides a certain support and psychological release from the oscillations and fluctuations of qualitative life-values, particularly where these are still in a state of being conquered. Finally, the complete inner estrangement of money from ideal values prevents an entanglement of the sense of values which would be extremely disquieting to sensitive people.

Money’s remarkable achievement is to make possible the most adequate realization and effectiveness of every individual complication through the equalization of the greatest diversity—as if all specific forms must first be returned to the common primary element in order to secure complete freedom for individual reorganization.

Likewise, money creates a world for us in which everything is in theory obtainable if we had enough cash. Where formerly, certain possibilities seemed metaphysically forestalled to a person–becoming a lord, moving to a new city, escaping serfdom or slavery–such things are now conceivable as possibilities in terms of a neutral quantity. The path from here to there becomes easy to imagine when it’s just a number.

Should we be lucky enough to have money, it becomes pure potential to us, defining us not in terms of a particular role or occupation but as the very freedom-to do anything up to the sum total quantity of money we possess.

Money means more to us than any other object of possession because it obeys us without reservation—and it means less to us because it lacks any content that might be appropriated beyond the mere form of possession. We possess it more than anything else but we have less of it than all other objects.

In the light of this, the extension of the self that the possession of money signifies is a very distinctive one. In one sense it is the most complete extension that can be derived from an object; in another sense it is a very limited one because money’s flexibility is only that of an extremely liquid body which takes on any form, and does not shape itself but receives any form it may possess only from the surrounding body.

So this is something of the Hegelian limit of the absolute freedom of money: it’s the freedom to do anything without giving you any idea of what you should do. Simmel points out that the socialist ideal would ironically exacerbate this condition by creating conditions in which the ability to differentiate yourself from anyone else would be even more difficult. Equality per se is no more full as an ideal than such freedom is.

If the development of working conditions continues to proceed in this direction—one made possible by money—then the elimination of certain abuses may perhaps be achieved, abuses for which the modern money economy has largely been blamed. The hostile rejection of relations of superordination and subordination is the motive for anarchism, and although socialism replaces this formal motive by a more material one it is nevertheless one of socialism’s basic tenets to remove the differences in human conditions that entitle one person to command and force the other to obey. To a mode of thought that takes the degree of freedom to be the measure of everything socially necessary, the abolition of superordination and subordination is a self-evident demand; but a social order based on superordination and subordination would in itself be no worse than one based on a constitution of complete equality if sentiments of oppression, suffering and degradation were not connected with the former. If socialist theories possessed more psychological clarity with regard to themselves, then they would reflect an awareness of the fact that the equality of individuals is not at all the absolute ideal or the categorical imperative, but only the means for removing certain feelings of affliction for promoting certain feelings of well-being. The only exceptions are those abstract idealists to whom equality is a formal, absolute value demanded at the price of all kinds of possibly practical disadvantages, even at the price of pereat mundus [let the world perish].

The very conception of such equality only becomes possible through money. Equality’s meaningful value lies in its ability to reduce suffering, not in bringing monetary values of people in line with one another just for the sake of doing so.

Outside of occupations, recreational and cultural activities also lose their essential character of defining an individual:

Here we have one of the most effective cultural formations, namely the possibility of the individual participating in associations, the objective purpose of which he wants to promote and enjoy, without that connection implying any commitment on his part. Money has made it possible for people to join a group without having to give up any personal freedom and reserve. This is the fundamental, extremely important divergence from the medieval form of unification which did not distinguish between man as such and man as a member of an association. It enclosed within its sphere the general economic, religious, political and familial interests alike.

Money has provided us with the sole possibility for uniting people while excluding everything personal and specific.

Simmel then returns to socialism as the perfection of this tendency. While capitalist economy gave us a conceptually autonomous individual heavily dependent on the cruel caprice of the invisible hand of the market, socialism liberates the individual from impersonal capitalist bondage and obligation while making differentiation that much harder to achieve. A member of a socialist society is that much more interchangeable than a member of a capitalist society. Both capitalist and socialist organization seek to “liberate” the individual from particular bonds, yet both end up unmooring the individual from the ability to subscribe wholeheartedly to a particular form of social value. This is a consequence of large-scale, urban modernity.

The more the unifying bond of social life takes on the character of an association for specific purposes, the more soulless it becomes. The complete heartlessness of money is reflected in our social culture, which is itself determined by money. Perhaps the power of the socialist ideal is partly a reaction to this. For by declaring war upon this monetary system, socialism seeks to abolish the individual’s isolation in relation to the group as embodied in the form of the purposive association, and at the same time it appeals to all the innermost and enthusiastic sympathies for the group that may lie dormant in the individual. Undoubtedly, socialism is directed towards a rationalization of life, towards control of life’s chance and unique elements by the law-like regularities and calculations of reason. At the same time, socialism has affinities with the hollow communistic instincts that, as the residue of times long since past, still lie in the remote corners of the soul. Socialism’s dual motivations have diametrically opposed psychic roots. On the one hand, socialism is the final developmental product of the rationalistic money economy, and on the other it is the embodiment of the most basic instincts and emotions. The distinguishing feature of its power of attraction lies in rationalism as well as a reaction to rationalism. Socialism has found its inspiring ideal in the ancient clanhood with its communistic equality, while the monetary system leads the individual retrospectively to concentrate upon himself and to leave as objects of personal and emotional devotion on the one hand only the closest individual relations, such as family and friends, and on the other the most remote spheres such as the mother country or mankind. Both social formations are completely estranged—even though for different reasons—from the objective association for specific purposes. One of the most comprehensive and fundamental sociological norms is in operation here. One of the few rules that may be established with some degree of generality concerning the form of social development is this: that the enlargement of the group goes hand in hand with the individualization and independence of its individual members. The evolution of societies usually commences from relatively small groups which hold their elements in strict and equal bonds and then proceeds to a relative larger group which affords freedom, independence and mutual differentiation. The history of family formations such as that of religious communities, the development of economic co-operatives and political parties all illustrate this type. The importance of money for the development of individuality is thus very closely related to the importance that it possesses for the enlargement of social groups.

In essence, socialism’s ideals are at odds with one another: it wants tight, familial bonds while erasing any particularities that could make relationships between individuals meaningful. The only relationship it can mandate is person-person. The contradiction of this ideal is a result of the pressure put upon the very notion of “value” by money, and it is not necessarily a soluble one. Money has shattered the “unity” of pre-modern life by bringing to it a greater and fragmented sense of possibility and contingency:

Both aspects may ultimately be traced back to one and the same effect of money, namely to grant separation and mutual independence to those elements that originally existed as a living unity. On the one hand, this disintegration concerns individual personalities and thereby makes possible the convergence of similar interests—however divergent and irreconcilable —in a collective form. On the other hand, this disintegration also affects the communities and makes internal and external communalization difficult for the now sharply differentiated individuals.