Debt: the seed of civilization

In these days of anti-capitalist protest, it is important to know that keeping track of debts led to the inventions of counting and writing, and eventually gave voice to art. [This is based on “Money: the seed of civilization,” an article for the Texas Numismatic Association’s TNA News, vol. 53, no. 6, November/December 2011. Other text is derived from comments posted to the Econolog and OrgTheory blogs about the recent works of anthropologist David Rolfe Graeber. Citations are at the bottom.]

 As a numismatist and an advocate for the Austrian school of free market economics, I find David Graeber’s work fascinating. Von Mises, Hayek, and Rothbard were largely ignorant of numismatics, hence of the history, art, and science of the moneys in which they invested so much emotion and thought.  Nonetheless, Graeber’s left-wing anarchist fear of money validates the warning from von Mises that capitalists and socialists often agree on the facts; they disagree on what the facts mean.  Graeber does know the facts. 
The works of numismatists Charles Opitz and Robert Leonard on primitive money substantiate at least the broad outlines of Graeber’s conjecture. Underlying that, however, is the deeper understanding of “debt.” It begins as a social obligation: not the transfer of “stuff” but the acknowledgement of status and relationship.  Wampum was invented by Hiawatha to ameliorate conflicts in order to rally the local tribes against the French and English invaders.  Soon, those invaders, knowing money, adopted wampum as an ad hoc currency. 

Left anarchists are not alone in their fear of the marketplace. 

“The Money Masters” is a video you can watch on YouTube.  The argument is that the Rothschilds created debt-based fractional reserve banking to control the world.  This video was touted by two Objectivist websites, Rebirth of Reason (here) and Objectivist Living (here).  Like most American conservatives, Objectivists advocate for gold as the monetary standard.  Murray N. Rothbard (though purged from Ayn Rand’s inner circle) argued that anything other than 100% gold backing for currency is fraud.  Most conservatives agree with this argument.  F. A. von Hayek, a self-identified liberal, did not.  Hayek argued for complete laissez faire in banking and did not presume to predict what forms of money would compete best in which markets once the legal monopoly is removed. 

There is in fact no known example of a human society whose economy is based on barter of the ‘I’ll give you ten chickens for that cow’ variety. Most economies that don’t employ money — or anything that we’d identify as money, anyway — operate quite differently. They are, as French anthropologist Marcel Mauss famously put it, ‘gift economies’ where transactions are either based on principles of open-handed generosity, or, when calculation does take place, most often descend into competitions over who can give the most away. … [The] economists get it … precisely backwards. In fact, virtual money comes first. Banking, tabs, and expense accounts existed for at least 2 thousand years before there was anything like coinage, or any other physical object that was regularly used to buy and sell things, anything that could be labeled ‘currency’. (Graeber here.)

I agree with Graeber that ultimately money grew from ritual gift exchange, just as the turbine generator descended from the campfire.  However, it is erroneous to project ourselves on so-called “primitive” people, even by reading the reports of “early” explorers.  From your grandparent to your grandchild is five generations. Any longer period may be “forever.” Assimilation of neighbors, displacement by foes or weather, and the occasional brilliant idea are among the many factors that can be lost to time.  When European explorers, including anthropologists, first met other people, the assumption was too easy that they always lived here, spoke this language, ate these foods, married in or married out.  They may not have. 

We do have a good history of the evolution of debt to money.  Again, we too easily assume that coinage is the foundation of money.  It was not.  Sophisticated fiduciary documents are thousands of years older than the first coins.

Clay tokens were antecedents to writing

Starting about 8000 BCE, a system of small clay tokens standing for farm produce became common across the Fertile Crescent of the Middle East.  By 5000 BCE, the tokens were routinely stored in clay jars.  You cannot see into a ceramic envelope, so the tokens were also impressed on the outside to show what had been baked within.  Two thousand years later, rather than the tokens, pictographs of them were written on solid clay hemispheres.  In another thousand years, these became tablets with cuneiform writing. 

Pre-Literate Art from Catal Huyuk

Through this long development, large numbers such as 4, 5, 6, and 7 were invented.  Before about 5000 BCE they could not even be conceptualized: five was recorded as “three-one-one.” 

Also, starting about 3000 BCE, as inscribed on statues, these cuneiform characters recorded personal names. They also begged short prayers of the gods.  The first poetry only came about 2700 and the famous Code of Hammurabi dates only to 1700.  Most subtly, the ordered writing of merchants, left to right, up to down, lesser to greater, eventually gave painting and sculpture a vocabulary of space.  Before debts and contracts were invented, artistic space was open and unstructured. 

Neo-Sumerian cylinder seal

Prof. Schmandt-Besserat first published her findings in Scientific American in 1978.  Ovcr the next decade, visiting museum collections, she arrayed enough proof to fill a large two-volume corpus, Before Writing (University of Texas Press, 1992).  The essential facts and evidences were then condensed into a popular paperback, How Writing Came About (University of Texas Press, 1996).  A children’s book was published in 1999, The History of Counting.  Most recently (2007) the University of Texas Press released When Writing Met Art. 

The weakness in Graeber’s theory, like that of Marx’s communal prehistory, and even the self-sufficient yeoman of Jefferson's democracy, is that there was no Eden stolen from us by the Serpent of Debt, Commerce, and Division of Labor.  We now know a direct line of development from debt to numeracy, literary, and the spatial vocabulary of art. 

Schmandt-Besserat makes clear that these early instruments were not money as indirect barter.  They were not passed from hand-to-hand.  However, they did record economic value and carried seals naming the parties.  In that, they foreshadowed the invention of coinage thousands of years later.  More subtly, this medium was like a modern bank draft because when these promises were paid and cleared, they were discarded. 

Debt led to writing by way of numeracy: inventories precede the Gilgamesh by thousands of years. We may be no more trapped and enslaved by debt than we are by literature, central heat, and the Hubble Telescope. If greed is good, then debt may be better.

Sources:

• Curious Currency: The Story of Money from the Stone Age to the Internet Age by Robert Leonard, Whitman, 2010. 
• Odd & Curious Money by Charles Opitz, First Impression, 1986. 
• An Ethnographic Study of Primitive Money by Charles Opitz, First Impression, 2001. 
• Debt: The First 5,000 Years by David Graeber (Brooklyn: Melville House, 2011)
• “Debt: The First 5,000 Years” (essay) by David Graeber online in many places including 
• MetaMute here http://www.metamute.org/en/content/debt_the_first_five_thousand_years
• And The Anarchist Library here http://theanarchistlibrary.org/HTML/David_Graeber__Debt__The_First_Five_Thousand_Years.html
• “Money and Politics - The Money Masters” posted by Michael Stuart Kelly to Objectivist Living 27 April 2007 - 08:07 PM here. http://www.objectivistliving.com/forums/index.php?showtopic=3514
• “‘The Money Masters’ Documentary,” posted by Mr. Jeremy M. LeMay (pseud.), to Rebirth of Reason, April 25, 2007. Here http://rebirthofreason.com/Forum/GeneralForum/1045.shtml
• “Graeber Book Forum Part 1” by Fabio Rojas posted to Org Theory, December 6, 2011, here http://orgtheory.wordpress.com/2011/12/06/graeber-book-forum-part-1/
• “On the History of Money,” by Arnold Kling, posted to EconLog, October 3, 2011, here http://econlog.econlib.org/archives/2011/10/on_the_history.html

ALSO ON NECESSARY FACTS

Accounting for Civilization

Art as Ordered Narrative

Money is Speech

City Air Makes You Free

Merry Newtonmas!

The Birth of Modernity

"Nature and Nature's laws lay hid in night:

God said, let Newton be! and all was light."

A little boy born in a small village across the sea would grow up to bring light to the world. 

Sir Isaac Newton was born on December 25, 1642, the same year that Galileo died.  Newton is perhaps best remembered for his work in physics, the Three Laws of Motion and his Law of Gravity.  To prove his physics, he invented the calculus.  He also invented the reflecting telescope.  His work in optics showed that white light is composed of colors.  This laid the foundation for the wave theory of light, though he advocated for light being a particle.  Newton demonstrated vector arithmetic.  He delivered an algorithm for conveniently computing square roots.  He offered an original proof for the Binomial Theorem (also called “Pascal’s Triangle”).  His image appears on coins and bank notes, which is appropriate since he was Master and Warden of the Mint, rescuing Britain’s money from looming disaster.  Sworn as a justice of the peace, he circulated in disguise among criminals to pursue counterfeiters.  He served in Parliament, representing Cambridge.  He was president of the Royal Society, England’s crown chartered association for scientists.  Alone, any of Newton's achievements would have left his imprint in history.  Together, they give shape to a complex and powerful intellect. 

Middlesex token 1792

Today, we ignore his religious writings, the extent of which actually eclipsed his scientific production.  His heretical Arian beliefs foreshadowed modern Unitarianism, but he swore under oath to be a Trinitarian so that he could teach at Cambridge. 

Newton’s colleagues called him fearful, cautious, suspicious, insidious, ambitious, excessively covetous of praise, and impatient of contradiction. Even his relatives and his true friends were modest in their praise of Newton. Physically sound in his life, he died at 84. He had lost only one tooth, still had much of his hair, and read without glasses. Yet, he was a hypochondriac, suffering from illnesses and diseases that he treated with medicines he made for himself.  

Newton's Reflector built by Himself

Newton’s many biographers illuminate different aspects of his life.  To Richard S. Westfall, he was “never at rest.”  Michael White called him “the last sorcerer” a soubriquet first suggested by John Maynard Keynes.  Newton did bring his alchemical knowledge to the Mint to test the gold plate for coinages; and he also conducted time-and-motion studies to improve efficiency.  But David Berlinski closed his story when Newton was appointed to the Mint, calling the last 30 years of his life “uninteresting.”  Yet that is where MIT professor of science journalism, Thomas Levenson, begins his narrative.  Richard P. Feynman once sought to treat his students to a complete demonstration of Newton’s proof of Kepler’s Laws and found that he could not: thanks to the calculus, we have forgotten much geometry. 

The fundamental industrial technology we take for granted is possible only because of Newton.  Moreover, his work launched the Enlightenment, offering a rational and experimentally-testable explanation for both celestial and mundane motion.  This suggested that all natural phenomena, including human events, could be understood by the same scientific method.   

Merry Newtonmas, everyone!
The Zebrowskis are part of small, but apparently growing, number of atheists, skeptics and other nonbelievers who make merry over Newton’s contributions to science and math—the discovery of gravity, the invention of calculus and the first reflecting telescope, to name a few.
Religion News Service 12/16/2011 here.

SOURCES

Berlinski, David. Newton's Gift: How Sir Isaac Newton Unlocked the System of the World. New York: Free Press, Simon and Schuster, 2000.

Craig, Sir John. Newton at the Mint. Cambridge: University Press, 1946.

Craig, Sir John. "Isaac Newton and the Counterfeiters."  Notes and Records of the Royal Society (18), London: 1963.

Craig, Sir John. “Isaac Newton - Crime Investigator,” Nature 182, (19 July 1958), pages 149-152.

Keynes, Milo. “The Personality of Isaac Newton,” Notes and Records of the Royal Society (49), London: The Royal Society, 1995.

Levenson, Thomas. Newton and the Counterfeiter: The Unknown Detective Career of the World’s Greatest Scientist (Boston;New York: Houghton Mifflin Harcourt, 2009. 336 pp. $25

Marotta, Michael. “Merry Newtonmas,” Newsgroups: rec.collecting.coins, Date: Mon, 25 Dec 2000 11:49:41 GMT

Marotta, Michael. “Sir Isaac Newton: Warden and Master of the Mint” http://sites.google.com/site/washtenawjustice/numismatics/sir-isaac-newton

Newman, E. G. V. "The Gold Metallurgy of Isaac Newton." The Gold Bulletin Vol 8. No. 3, London: The World Gold Council, 1975.

Westfall, Richard S. Never at Rest: a Biography of Isaac Newton. Cambridge: Cambridge University Press, 1980.

White, Michael. Isaac Newton: The Last Sorcerer. Reading, Mass.: Helix Books, Perseus Books, 1997.

www.experiencefestival.com/newtonmas

www.newtonproject.sussex.ac.uk/, The Newton Project, Professor Rob Iliffe Director, University of Sussex, East Sussex - BN1 9SH

www.royalmint.com/museum/newton Web site pages of the British Royal Mint.

Another Case of Fraud in University Research

“ ...  he was immediately fired by the university, admitted to his lengthy fraud, and handed back his PhD degree.”

On the Strategy Profs blogsite (here) Prof. Freek Vermeulen (associate professor of strategy and entrepreneurship at the London Business School) wrote about the case of Diederik Stapel.  Stapel earned a cum laude master’s (1991) and a cum laude doctorate (1997) from University of Amsterdam.  He taught at the University of Groningen (2000-2006) and then the University of Tilburg, where he launched the Tilburg Institute for Behavioral Economics Research.  He was made dean of the social and behavioral sciences faculty in 2010.  (Wikipedia here.)   Then, it all fell apart.

In Vermeulen’s words:  "For years – so we know now – Diederik Stapel made up all his data. He would carefully read literature, design all the studies (with his various co-authors), set up the experiments, print out all the questionnaires, and then, instead of actually doing the experiments and distributing the questionnaires, made it all up. Just like that."

In my response on that blog site, I pointed out that loss of your degree is the appropriate remedy for academic fraud. 

One of the highlights of my studies at Eastern Michigan University was the class in “Ethics in Physics” which I took for graduate credit as a cognate elective.  The class was first created over 25 years ago by Prof. Marshall Thomsen, and has continued to top the list of such offerings by all schools.  My professor was Patrick Koehn.  (Prof. Beth Kubitskey made this her master’s thesis and also has taught the course.)  For my term paper (Google Docs here), I set academic fraud in a criminological context because very little research has been done by criminologists on this.  I also found a deep precedent for allowing the university to deal with its own problems.  The word “universitas” refers not to the collection of colleges or their classes, but to the charter which grants the institution legal standing to deal with its own members.

Academic sanctions also avoid the useless reprisals, retaliations, and retributions of the governmental courts and prisons.  

“In responding to and resolving the criminal behavior of employees, organizations routinely choose options other than criminal prosecution, for example, suspension without pay, transfer, job reassignment, job redesign (eliminating some job duties), civil restitution, and dismissal...

While on the surface, it appears that organizations opt for less severe sanctions than would be imposed by the criminal justice system, in reality, the organizational sanctions may have greater impact...  In addition, the private systems of criminal justice are not always subject to principles of exclusionary evidence, fairness, and defendant rights which characterize the public criminal justice systems. The level of position, the amount of power, and socio-economic standing of the employee in the company may greatly influence the formality and type of company sanctions.  In general, private justice systems are characterized by informal negotiations and outcomes, and nonuniform standards and procedures among organizations and crime types.”

(Hallcrest Report cited in Introduction to Private Security, Hess and Wrobleski, West Publishing, St.Paul, 1982, 1988. The Hallcrest Report I and II, by William C. Cunningham and Todd H. Taylor, et al., Butterworth-Heinemann, Boston, 1985 and 1990.)

Criminologists point to the failure of “general deterrence.” It is famous that cutpurses worked crowds gathered to watch the hanging of a cutpurse.  However, white collar crime in general and academic fraud specifically meet all the criteria for free will and rational choice.  It is planfully competent.  Academic fraud cannot be blamed on your parents, your neighborhood, or your lack of educational opportunities.  It is not a genetic disorder or a vitamin deficiency. 

Diederik Stapel gave back his doctorate.  Jan Hendrik Schön had his rescinded by the University of Konstanz.  For defrauding the National Institutes of Health, Dr. Eric Poehlman was sentenced to a year and a day in prison; but he kept his degrees.  While prison is pain and is intended to be so, a year of incarceration is nothing more than a harsh sabbatical.  Disgrace is bad enough, but the loss of your degree – having to give it back or having it taken from you – is and should be a sword over your head.

Earlier posts on this blog:

Misconduct in Science and Research

Who Guards the Guardians? links to my other blog CSI:Flint – Who Guards the Guardians? which I created after presenting to two middle school classes for "Super Science Friday" at the University of Michigan Flint campus, May 5, 2011.

The Economic Value in a Liberal Education

On the blog, OrgTheory, Prof. Fabio Rojas has been arguing against indiscriminate college education. His thesis is that college is largely not necessary for the work that college graduates find. The majors in question are humanities and fine arts. Clearly, engineers including computer science majors remain in demand. These comments are edited from and based on my responses there.

Adam Smith pointed out that theology degrees were subsidized and produced little life earnings, whereas doctors and lawyers pay for their own schooling and are rewarded well. So, this is all known.

On the other hand, Mark Van Doren's Liberal Education taught that the full range of intellectual pursuits combined is necessary to the development of a fully competent individual. In the medieval university, the two broad studies were the trivium (grammar, rhetoric, and logic) and quadrivium (arithmetic, music, geometry, astronomy). Today, these are classes in communications, literature, film, art and art history, foreign languages, computer literacy, algebra, statistics, calculus, physics, biology... the entire university catalog.

The first steam engines were not built by degreed mechanical engineers because that college major did not yet exist. The same applies to electrical engineering and famously to computer programming. Community colleges and universities alike scramble still today to offer classes in computing topics that did not exist when professors were freshmen from medical imaging and geographic information systems to website design and mobile applications. (Music is no longer taught with mathematics and physics, as it was in the Middle Ages, though electronic hardware and software offer frontiers of understanding and expression). Yet in those cases, exactly and specifically, broad and deep knowledge bases were integrated to create new technologies.  The  most economically valuable education may be the one that is pursued for its own sake.

Moreover, as Prof. Fabio Rojas is a sociologist studying economic interactions, I had to ask what value is delivered by classes in sociology and economics. Sales and marketing, and bookkeeping and accounting were and are important and valuable services; but neither sociologists nor economists were ever in demand. Despite the polling and public relations work of Paul Lazarsfeld and Robert King Merton, sociology never escaped from Marxist criticism of our market society. And sociology ends there with no practical solutions to any perceived social problem, except that we should be nice to each other. Do Microsoft and Apple employ hundreds or even dozens of economists from Chicago or Harvard, while hometown pizza and florist shops take on part-time economists with community college certificates? Of course not.

We know from measurable results that police officers with college degrees both make more traffic stops, and yet have fewer negative interactions with the public: they work harder and better. But college classes in criminology do not teach traffic stops or public relations. Something else is engaged. 

Alternately, it may be true that only hubris allows anyone to predict today what skills will be demanded tomorrow. Rather than perceiving education as something we pass through as we acquire the sum total of all previous knowledge - a task never really possible even to a medieval apprentice - we recognize the importance of lifelong university engagement. We should look forward to a future where several degrees at every level are the hallmark of a productive intellect - while keeping in mind that neither Bill Gates nor Steve Jobs would have met that benchmark.

Caution is demanded when we speak of “the job market” or “the economy” or “society.” These may be reifications or they may be easy labels or they may be fantasies. Ben & Jerrys, the Mondragon cooperative, the solitary Microsoft Developer, or the person working part time for three places in three different capacities may be outliers or they may be the hidden norm. That is what change is: an unperceived new norm, measurable only after the event.

One complaint from Prof. Rojas, made also by some of the Occupiers in the news, is that the massive student loans can never be repaid from expected earnings, especially from degrees in the humanities. However, over the course of a lifetime, a communications major at a series of low-paying white collar jobs may never pay back the principle and interest of a loan, but still net out more money than working without a degree. Sending Sallie Mae a check for $100 or $200 a month is not much worse than the billing for cable-TV, heat, or electricity, and less than an automobile loan. Second, while it is broadly true that service sector and manual labor jobs pay less than white collar work, it is not necessarily true. You do not need a degree to be successful in sales. (A communications degree would be a good choice.) Third, it is a truism that entrepreneurship pays more than employment, for instance owning a styling salon or an oil change franchise. Perhaps the problem is training people to work for wages rather than for opportunity.

If the college loan program fails – as it seems it may – then, this is merely another bubble, no different from the South Seas or Dot.Com or Housing bubbles … given that the failures are allowed to wash out. Of course, that is not true here, as student loans are not affected by bankruptcy and default. That does not mean that the loans will be repaid, only that the debt will carried on everyone’s books, as liabilities for borrowers and assets for lenders, and not real at all in either case.

Ultimately, education can never be taken away. Thus, we raise the general education level. In previous generations, we taxed property in order to create public schools. But we know that government spending is necessarily a bad investment — and these are often bond issues: the district sells bonds to raise cash and pays them off from taxes. Again, these are apparently massive debts that are never repaid.  Were universal high school or grammar school bad ideas, not worth the investment?

Prof. Fabio Rojas's relevant posts on OrgTheory

College Fundamentalism versus College Realism

Poll on College and Jobs

Useless Majors

All of the above based on this discussion from Arnold Kling on Economics and Liberty about wasted education, "The Great Stagnation."

ALSO ON NECESSARY FACTS

Profits and Benefits in Foreign Languages
Education in America: At Least Two Cheers
Anti-Intellectualism in American Life
The Scientific Method

Inconvenient Questions about Global Warming

Al Gore’s An Inconvenient Truth (Paramount Classics, 2006) suggests many questions about basic facts. 

From about 20 minutes in to about 25 minutes in, the presentation faltered from confusions of color and graphics. At about 00:20:34 the former US Vice President showed a graph of “temperature” over the past 650,000 years in Red.

I assume that this is Earth’s average surface temperature, but that was not explicit, nor was it explained how he knew. How CO2 was determined is also not clear. During the middle of the Pleistocene there was no US Weather Bureau to read thermometers. So, how do they know, perhaps from fossil trees or maybe from coal or peat bogs? I agree with the apparent fossil record, but it includes huge extinct beasts like the megatherium and glyptodon and little evidence of hominids and their campfires. What caused the end of the previous ice age if not anthropogenic global warming.

The first graph shows CO2 in blue. It gives Temperature in degrees F, showing a dramatic increase. The scale is 0, 0.5, 1.0 and the line rises from 0.0 to above 0.5.

Then the legend changes. The color scheme inverts. At about 21:00 minutes, the display shows 650,000 years of CO2 in Red. Temperature is in blue.

At about 00:21:35 the uncalibrated temperature over 650,000 years is shown together with with CO2. Then from 00:22:34 to 00:22:49 the Red CO2 at our current measure or level or amount goes up and off the scale but the blue Temperature does not. Should not the temperature have increased dramatically by half a degree or more?

If CO2 is increasing at alarming rates, that can only be important to us if temperature is also increasing, melting the ice caps, bringing citrus to Michigan, and so on. Apparently that is not the case. Even if atmospheric CO2 is increasing, Earth’s nominal average surface temperature seems not to be.

Eurion Project Launch and Update

Numismatists find it difficult to impossible to catalog, archive, and study modern banknotes using modern computer equipment. The hardware in scanners and printers, and the software for them (both the lower-level drivers and the higher level graphics arts programs), can and do identify money and refuse to copy it.  That would seem to be appropriate to prevent counterfeiting.  But it also thwarts legitimate scholars and hobbyists from advancing the field of study. 

(Originally published here, February 11, 2011. Pulled, republished, and pulled again.  Merged with an Update and reposted October 18, 2014.)

Since 1997, security features integrated into paper money make it increasingly difficult - sometimes impossible - for numismatists and other researchers to archive and reproduce images of these cultural artifacts.  The goal of this project is to create a database of digital solutions to permit the lawful creation and use of digital images of these commercial instruments.

In coordination with the manufacturers of computer equipment, central banks have created anti-counterfeiting measures that thwart numismatists. Our computer hardware and software stop working when they detect modern paper money. The reactions of scanners, printers, and graphics programs are not consistent across manufacturers, makes and models. Some multi-function devices will copy or scan but not print. Others will not scan. Some software recognizes paper money while other programs from the same company do not. Typically, if you can scan a modern banknote and store the image, when you send it to output, the printer stops. The last thing the printer gives you is a message telling you to visit the website http://www.rulesforuse.org/ which was established by the Central Bank Deterrence Group.

This is as far as my scanner would go.

Originally, it was thought that the "EURion constellation" was the problem. If you look at a large denomination bill you will see that the little yellow zeroes in the fields are roughly in the shape of a trapezoid with one in the middle, sort of like the constellation of Orion. On the UK £20 commemorating Sir Edward Elgar, the little circles were the bodies of musical notes on a staff.  In 1997, Austria, France, and Belgium integrated these into their banknotes.  Computer science professor Markus Kuhn identified them on the new euro notes of 2000, hence the name EURion.  Then his colleague Steven J. Murdoch found that this not the same trigger that causes problems for numismatist.

Numismatics is the art and science that studies the forms and users of money.  Most people think of it as "coin collecting" but numismatics encompasses fine art medals, merchant tokens, and all forms of fiduciary paper, including the promissory notes of governments and central banks, as well as the bank drafts of individuals, and corporate stock certificates.  Numismatists write and publish about these artifacts, of course.  That creates the initial need for reliable, repeatable research that meets the standards of good science.  In addition, at our conventions, we create and display museum quality educational exhibits. Graphical enlargements of key features are an important element in those presentations.

Sir Isaac Newton, once commemorated on a Bank of England 1-Pound Note
The book in his lap is opened to the proof at left.
Newton served as President of the Royal Society of which
colonist Benjamin Franklin later was a member.

In a previous era, it was always possible to photograph coins and currencies.  Today, we can scan images of coins and reproduce the electronic images, but with paper money, we are stopped. The root of the problem is that the means of recording and reporting are also the methods of counterfeiting.

 The laws that make it illegal to transport the tools of counterfeiting include various prohibitions against the electronic transmission of the electronic means of electronic reproduction.  The relevant laws in the USA are found under US Code Title 18, Part I, Chapter 17 Coins and Currency; and Chapter 25 Counterfeiting and Forgery. However, both U.. S. Code Title 18  Part I Chapter 25 Paragraph 474(b) and paragraph 504 mandate that the Treasury Department establish guidelines for the legitimate use images. Title  31 Chapter IV Part Part 411 of the U.S. Code of Federal Regulations permits limited reproduction of color images.

My goal is to create a database of clickable binary patches for hardware and software that will let a numismatist scan, archive, copy, and print modern banknotes for purposes of research, study, reporting, discussion, and education.  So far, no one has approached this systematically, working across banknotes, hardware, and software. I am working with computer security researchers to overcome those barriers.

On December 3, 2010, and January 5, 2011, I introduced the problem to ArbSec, a computer security research club in Ann Arbor, which grew out of DefCon734.  Piqued by the challenge, some are interested, but none is willing to contravene U.S. law.  I also contacted four of the leading dealers and archivists from the International Banknote Society: Audrius Tomonis (http://www.banknotes.com/), Tom Chao (http://www.tomchao.com/), Ron Wise (www.banknoteworld.com/). and Owen Linzmayer (http://www.banknotenews.com/).  Originally a Macintosh guru, Owen discovered what numismatists call "notaphily" when working Europe and enjoying a wide array of fascinating currencies.  Owen was most helpful with this project, forwarding problems for my database.

Austrian Economist Eugen von Boehm von Bawerk
On the back is the Institute of Science

Maria Sklodowska-Curie celebrated by Poland
and Demokritos of Abdera honored by Greece
(It is bit harder to pay homage to Benjamin Franklin)

Last year (November 2010) at this time, I launched a project to investigate the problem and seek ways around it. The status then was summarized on this blog here.  The project languished as I moved from Ann Arbor to Austin. 

However, the biggest impediment was the lack of understanding from the numismatic community itself.  Eariler this month, I received an email, a forwarded message, from a discussion board.  In it, the original writer claimed to have found a way around the problems by enlarging or reducing the images.  That, of course, was nonsense... or, at the least, incomplete.

Numismatists who count the reeds on the rim of a coin reported their successes or failures at scanning banknotes without giving the makes and models of their hardware or software or the issue and variety of the object being scanned or printed.  They reported their own personal workstations and projects as if these were universal and constant. They carried out uncontrolled and haphazard tests and claimed that these "proved" their "theories." I found it frustrating. The only thing proved was that science learning in America has all but failed for the great masses of nominally educated people who have no idea what a theory is or what constitutes proof.

Generally, professional numismatists and numismatic researchers are relying on older, pre-millennial hardware and software.  Some still shoot pictures to film.  As post-millennial computer platforms are replaced newer hardware and software stay ahead of the curve, just as new banknote issues engage security that is far beyond the classic "Omron rings" that defeated commercial photocopiers over a decade ago.

Claimant: The problems you are all finding with scanning new banknotes is not with the scanner itself but with the software used to scan. With most of the industry standard scanning software it is possible to scan at 150% or 200% enlargement, or at 50% reduction in actual size, without a problem. This is because most of the legal requirements for the reproduction of banknotes favours reproduction at less than half size or greater than double the size.

Tester: I just tried that (again) and it (still) does not work.  I have a Canon Pixma MG6120. I tried it in hardware mode, from the front panel of the copier/scanner and both menu paths led to the same result: at 183%, the scanner ran the length of  a US $10 Series 2006 bill, fed the paper and ejected a blank sheet with an error message: "Timed out." 

When you scan paper money with post-2000 equipment, the scanner records the action; and depending on the make and model, may also send a message via the Internet to the authorities.  See the current TV commercials to the tune of Melanie's "Brand New Roller Skates" about taking a picture on the road and having it print out at home.  Enter "print at home from anywhere" into a browser and follow the links. 

I am not saying any numismatist will get a knock on the door, but I am saying that if you are arrested for counterfeiting, they can go back and check their disk farms and find your work; and when they seize your computer, your printer/scanner will provide a record as well.  And that is fine as a law enforcement measure.  Unfortunately, it prevents the recording, archiving, study, and reporting about historical artifacts of trade and commerce.

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Money is Speech and Press

Money is Speech

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Supplies and Demands

From "Inspired Business" 
http://www.inspiredbusiness.eu/

In Economics 101, the Supply curve and the Demand curve are displayed.   The point where they intersect is called “equilibrium” where the most efficient allocation of resources is claimed to occur.  This ignores the fact that every point on either curve represents a choice, an exchange of a lower valued good (or service) for one of higher value. 

On each curve, the quantity demanded (or supplied) changes. But where they intersect is only one such point. The other choices do not disappear. People are still demanding and supplying all along both curves.

The danger – the tragedy – is that claiming that the intersection of these two curves indicates a special equilibrium. This causes those in political control to believe that they should or must force all supplies and demands to be at this point.  Interest rates are raised or lowered; money is created (rarely destroyed); tax laws are written or rewritten. In some societies criminal penalties are enacted and enforced for prices other than the approved one.

At the very least, and as the foundation of the wrongs cited above, economists teach that any other price except the equilibrium is inefficient and thus markets are not perfect. 

The curves should be called "Supplies" and "Demands" and their intersection should called the "modal point."  This is where "most" trades take place.  But nothing else is special about it. 

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Nerd Nation 3.0 Gaming Goes Mainstream

On my way to volunteer at a family resource center, I checked a bus stop for the routes and saw a tag for GIS (geographic information systems) on the back. I found more and took pictures which I sent to my professor for the graduate class in remote sensing, Dr. William F. Welsh.  I mentioned also that I joined a local D&D group and he sent back a link to a Salon story: "How Dungeons & Dragons Changed My Life" by Ethan Gilsdorf. 

When I hit 40, I discovered my cache of D&D rule books and dice some two decades after I’d last laid eyes on it. Stirred by nostalgia, I wrote “Fantasy Freaks and Gaming Geeks,” a travel memoir/pop culture investigation that records a year spent “re-geeking” myself and reintegrating D&D and its ilk back into my life. Thanks to the widespread acceptance of gaming and fantasy subcultures — from “Lord of the Rings” to “Harry Potter” to MMOs (online role-playing games) like “World of Warcraft” (aka WoW) — that re-geeking was easier than I expected.

Ethan Gilsdorf wrote a book about it, Fantasy Freaks and Gaming Geeks.  In addition to his Salon posts, he has a very rich blog dedicated to the ins and outs of all things nerdly and geekish.

These are Tolkien-themed videos I shot in New Zealand: looking for hobbits in Hobbiton (Matamata); elves in Rivendell (Kaitoke Regional Park); Weta Workshop (Wellington); and a mash-up of footage from the "If you want him, come and claim him!" scene (Arrowtown).

In his reply to my email, Bill Welsh said that he had been a big D&D gamer.  I was not surprised.  He was also not alone on the campus of Eastern Michigan University.  My professor for the undergrad class "Deviance and Society," Dr. Roger M. Kernsmith also studies the sociology of gaming.  Between the bachelor's and grad school, I wrote a column for the ANA's Numismatist magazine about "xeno-numismatics" the moneys of science fiction and fantasy.  Researching that, I discovered True Dungeons, a live action role-playing game (LARP) at Gen Con in Indianopolis run in a two-story dungeon.  I sent an email to Dr. Kernsmith, who replied, "I just came back from there."

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Eyewitness Testimony: Popper, Wittgenstein, and the Innocence Project

News traveled quickly within academic philosophy that on the night of October 25, 1946, in Room H3 (number 3; staircase H) of the Gibbs Building, at Kings College, Cambridge, Ludwig Wittgenstein and Karl Popper had gone at each other with red-hot fireplace pokers.  Of course, that is not what happened.  Yet, the true sequence of events remains uncertain and contested. 

Wittgenstein’s Poker: The Story of a Ten-Minute Argument Between Two Great Philosophers by David Edmonds and John Eidinow (HarperCollins, New York, 2001).

Juries are swayed by eye-witness testimony.  Yet it is highly unreliable – and is known to be subject to simple error as well as police misconduct and prosecutorial fraud.  Over the past 15 years, thanks largely to the Innocence Project, and the advocacy of academic criminologists, some changes in police procedure have been written into law.  However, on the streets, in the lock-ups, in the courtrooms across America, at the local level, tradition rules.  (If you do not know the case of Jennifer Thompson and Ronald Cotton - “What Jennifer Saw” PBS Frontline show here – you need to understand the limits of witness identification.  The Innocence Project page on this case is here.)

·                                 

In the matter of Wittgenstein’s Poker, an audience of perhaps 30 academics - students, dons, professors - fifteen professional philosophers at one of the world’s best universities, all of them at some level specialists in the theory of knowledge, did not agree on the details of a 10-minute drama. 

Beneath this is the foundation of science.  Sir Karl Popper invented the theory of falsification, presenting it in his 1935 work, The Logic of Scientific Discovery.  Simply put, a broad theory based on some evidence can explain much.  Astrology works like that.  You are a Libra; your partner is a Capricorn.  You think you are in love, but the charts say you are incompatible.  An astrologer will delve into your rising signs and conjunctions and aspects, and ultimately can produce almost any result you want.  Popper felt that this was true of Freudian psychology, which he called a pseudo-science.  Science is subject to disproof.  According to Popper a complete theory suggests its own testable limits.  This was revolutionary in 1935 but is accepted without question today. 

But social theories are largely not subject to disproof.  The failures of communism (and before that of fascism) are argued away by true believers, just as astrologers and creationists present ever more explanation to overcome difficulties.  (The easiest claim is that the USSR was not practicing true communism, but only state capitalist revisionism.  Actual communism would be successful.  Any failure must not be real communism.)  Ultimately, this applies to radical feminism, to postmodernism, to the broad spectra of both the left and the right.  The true believer finds no reason to be tolerant of other opinions because they are not interested in being proved wrong in the search for truth. 

That expresses Popper’s political philosophy, expounded in The Open Society and Its Enemies, for which he was knighted.  Written before World War II, but published only afterward, the book calls for tolerance based on ignorance.  We cannot know for certain that we are right.  Our ideas might be falsified.  Thus, we are mindful of the sensibilities of other people, even as we disagree.  In his essay “What Does the West Believe In?” (delivered as a lecture and then added to a compendium, In Search of a Better World: Lectures and Essays from Thirty Years) Popper notes that unlike the Marxists of that time, or too many other creeds and their variants, the West largely has no single doctrine.  The strength of our society, the source and expression of our freedom, is that we do not "believe in" any one thing.  Rather, we accept many things as being true, for as long as they stand up to scrutiny. 

How then did Popper come to promote his idea of falsifiability?  What if it later were falsified?  That would be a paradox, of course, as is his intolerance of intoleration.  It is ironic, then, that he denied the validity of the ideas of Ludwig Wittgenstein.  Wittgenstein claimed that there are few (if any) real problems in philosophy, but only apparent problems from loose language.  Clarify your concepts and problems disappear.  Wittgenstein’s Tracticus Logico-Philosophicus was nicely organized in outline form and relied heavily on the symbolic logic of Russell and Whitehead. 

The easy resolution is that word games aside (falsifying falsification; not tolerating intolerance), it is usually better to reserve judgment and be open to those who would prove you wrong. Ultimately, of course, right and wrong do exist; and the wrong is discarded for failing a single test, while the right stands up to probe after probe.  Unfortunately, the criminal justice system does not work that way. 

The incident is described on pages 16-20 in Chapter 2, “Memories are Made of This.” 

Both Popper and Wittgenstein are at the tops of their careers.  Both are accustomed to holding the attention of those to whom they speak. Popper is the guest speaker, but Wittgenstein will not yield.  They argue. 

“Consider this poker,” Peter Geach hears Wittgenstein demand of Popper, picking up the poker and using it in a philosophical example.  But, as the discussion rages between them, Wittgenstein is not reducing the guest to silence (the impact he is accustomed to), nor the guest silencing him (ditto).  Finally, and only after having challenged assertion after assertion made by Popper, Wittgenstein gives up.  At some stage he must have risen to his feet, because Geach sees him walk back to his chair and sit down.  He is still holding the poker in his hand.  With a look of great exhaustion on his face, he leans back in his chair and stretches his arm toward the fireplace.  The poker drops to the the tiles of the hearth with a little rattle.  At his point, Geach’s attention is caught by the host, Richard Braithwaite.  Alarmed by Wittgenstein’s gesticulating with the poker, he is making his way in a crouching position through the audience.  He picks up the poker and somehow makes away with it.  Shortly afterward Wittgenstein rises to his feet in a huff, quietly leaves the meeting, shutting the door behind him.”

Michael Wolff sees that Wittgenstein has the poker idly in his hand ... Peter Munz watches Wittgenstein suddenly take the poker - red-hot - out of the fire and gesticulate with it in front of Popper’s face.  Then Russell - who so far has not spoken a word - takes the pipe out of his mouth and says firmly, “Wittgenstein, put down that poker at once!” His voice is high-pitched and somewhat scratchy.  Wittgenstein complies, then, after a short wait, gets up and walks out, slamming the door.   From where Peter Gray-Lucas is sitting, Wittgenstein seems to be growing very excited about what he obviously believes is Popper’s behavior and is waving the poker about. ...  Stephen Plaister, too, sees the poker raised. ... To Stephen Toulmin, sitting only six feet from Wittgenstein, nothing at all out of the ordinary is occurring; nothing that in hindsight would merit the term “incident."

According to Edmonds and Eidinow, Hiram McLendon’s account is corroborated by Bertrand Russell: they remember that Wittgenstein became agitated, grabbed the poker and waved it.  John Vinelott supports Popper’s story published in 1974.  Popper recalled that when asked for an example of a moral principle, he replied, “Not threatening visiting lecturers with pokers.”  Defeated, Wittgenstein threw down the poker and stormed out. 

Several points are at issue, not the least of which is the threat with a red-hot poker. Did Wittgenstein leave abruptly, slamming the door, after he asked Popper for an example of a moral rule?  According to most retellings, Wittgenstein left the room before Popper offered the example.  It may remain forever impossible to falsify any explanation of the events. 


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