George Epstein: Whom Do You Trust?

Let’s talk about money. Most adults go to work most days for half their waking hours. In exchange for those efforts, their employer hands them a piece of paper called a check or beams some electrons at a computer (called direct deposit), or maybe actually hands them (somewhat sketchily) U.S. currency. It’s amazing that we devote so much time and effort in exchange for something so amorphous as “money.”

But we’re OK with it. That’s because we can count on stores to sell us food, landlords to provide us with shelter, and dealers to give us a car in exchange for this stuff called “money.” The whole of our economy — of the world’s economy — is built on the fragile agreement that those pieces of paper and electrons will be accepted by all. Money’s value depends solely on the trust of the people. It is a fragile thing. We saw 1930s Germany descend into Nazism because the country printed immense amounts of Reichsmarks to pay off its reparations debt from WWI, causing the currency to be worthless. Today, countries like Venezuela, Argentina and Turkey face the rise of dictatorships as trust in their currencies collapses.