When the Future Comes, Who’ll Get the Bill?
Introducing a month-long series about the future of our money
I don’t know the last names of my neighbors in the apartment to my left. Nor is it even remotely probable that I’ll meet the person who wrote “come visit Hawaii sometime, it’s nice” on one edge of the dollar bill I spent today in Los Angeles. No matter the place we call home, for the most part we live in a nation of strangers.
But that isn’t to say we aren’t connected. Traditional concepts of nationhood emerged from groups of people bound together by common heritage, shared language, and the psychological baggage of a collective history. While the importance of each of these defining characteristics is changing in a more digital and globalized world, one pretty good indicator of where we call home is the money we spend and how we spend it.
Territorial settlement, infrastructure investment, population growth, education systems—these are the components of modern nation building. They’re also the same components that constitute economic development. Nationhood and money have long been intertwined, the power of a currency directly informed by the wealth of its issuing country.
Historically, the world’s dominant currency has changed roughly once every century. In the 1400s, Portugal became the world’s first global empire, spreading its currency to Africa and East Europe while running cargo ships for trade back and forth to Japan and Brazil. In the 1500s, Spain’s money reigned supreme, while the 1600s favored the Netherlands and the 1700s, France. When Britain industrialized and created central banks in the 1800s, it tied its power-house currency to the value of gold. By the end of World War II, the U.S. dollar (dominant since the 1930s) was the de facto reserve currency to which all others anchor and adjust their value.
If the trend continues, this current 100-year-cycle is nearing its end—and we’ll soon be onto the next. Does that mean the Chinese yuan will dominate the economy of the 21st century? What about the Indian rupee?
But maybe those aren’t the right questions at all. A better one is whether the government-valued and government-issued money we’ve used for centuries will even be around a few decades into the future.
We surely know what a dollar is worth, but what is its cost? Physical currency has an expense — everything from the most benign bank-transfer fee to the costs of counterfeiting, underground cash-based economies, and tax evasion. In theory, virtual currencies like Bitcoin avoid these issues. There’s no paper money to print or coins to produce. There’s also no one central bank or regulator. They bypass government authority; they’re currencies without nationalities. But just how democratic and stable are they? And in places like Africa and Afghanistan, where unbanked populations deposit money into accounts stored on their mobile phones, has the time arrived to mourn the death of the bank?
These are the questions for the next 100 years.
Welcome to this month’s How We Get To Next theme: Made of Money. Throughout March 2016, I’m curating a series of posts about the future of money and nationhood — or at least the disruptions around them we think we can predict. (And yes, I know, even the phrase “the future of money” itself gets abstract and confusing. Don’t worry, we’ll cover it.) Over the coming weeks, we’ll look into just how the money we use is part of our national DNA, before turning the lens of currency askew to evaluate the future of happiness economics in a capitalistic world tuned to the bottom line. We’ll investigate whether cashless societies are too big a threat to personal freedom, tour an underground economy, see how designers engineer the world’s most beautiful bank notes, track the location of all the dollar bills in circulation, and more.
To get a sense of where else the conversation is headed, check out our call for pitches. Even if you’re not a writer, I still want to hear from you! Reach me at abigail@howwegettonextcom. Or, you can always respond to anything we post on Medium by clicking the speech bubble at the bottom of the page, or highlight and share whatever piques your interest. As always, we’ll be on Twitter and Facebook monitoring chatter that arises, and further dialoguing with our readers.
One of my old journalism professors once said that “every story is a money story.” Let’s go find them.
This post is part of How We Get To Next’s Made of Money month, looking at the future of money throughout March 2016.
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