WHAT I LEARNED IN MEXICO
by Charles Carreon
6:04 pm, March 26, 2005
Economists define money as M1 plus M2 and M3. I imagine them as various “layers of money” that move around the globe at different speeds, like so many jet-streams of value.
They move at different speeds because M3, the money stream containing the big chunks of cash — which includes all accounts over $100,000 — moves a bit slower than M1, which includes speedy money like a lowly twenty dollar bill circulating in a crack house or gambling den, which may flip over twenty times in a day. Much of the money in M1 is in fact the proceeds of crime many times over, and that money moves at a much higher speed than the big money. There are probably dollars that haven't served as the media of lawful commerce in decades. Of course, much of the exclusive M3 money is also criminally derived, for example by looting governments and corporations, laundering money, avoiding taxes, and giving and accepting bribes.
Poor countries don't have a lot of M3 money, by comparison with rich countries like England and Switzerland and the US. M3 money gets traded around in big blocks, slow and sure, and most of the time it sits. M1 money, of which there is a great deal more in poor countries, proportionately, moves very fast by comparison. There is a great deal of M1 money, and a great deal of it serves to fulfill forbidden desires, such as the purchase of contraband, the procuring of disloyalty, and the inducement to commit theft.
Much money is spent to do forbidden things, and that is perhaps a potential barometer of total human iniquity and/or goodness. I have often pondered the notion of the meaning of money in human life. This meaning was seriously cast into doubt during my early life. One group of people, my nanny's family, both poorer and more physically robust than my people, being American Indians, often told me that “money is the root of all evil.” I reported such communications to my father, who characteristically seemed antagonized by the notion. He clarified for me quickly: “Money is not evil. It depends on what you do with it. You can only help people if you have money.” Those were the exact words of my dad, Conrad James Carreon, may peace be upon him. And although technically I believe you can help people without money, in my case, it really helps.
But you can imagine the battle this set up in my mind. Some people that I loved and trusted said money was bad, and my father said it was good. I liked having money, and learned that when we went to Mexico, lots of fun snacks, toys and entertainments were well within my price range. I also felt bad seeing young boys no less worthy than I, shining a pair of shoes for a Mexican peso, the equivalent of twelve and a half US pennies. Of course, you could get a six ounce Coke and two cookies for one peso, or a mighty tasty taco or quesadilla. So it all made sense, kind of. Except why I had so much money when I was still just a kid. My dad conveyed to me the benefit of the greater abundance, and it was a fun, but still perplexing, discovery.
I remember when I learned that taxation was raising the prices of US products in Mexico to double their cost in the US. So rich Mexicans paid through the nose to look like their US models. That shocked me. There didn't seem to be anything fair in even a rich Mexican having to pay twice the price to have a cream-colored Chevrolet Impala with a red interior or other delectable automotive delight. Now I understand subsidies, as in the subsidy that the Mexican government was providing to encourage domestic auto production. At that time, I believe the domestic auto industry was a silly vehicle called “The Borgward,” which was a silly creation turned out by a factory that Mercedes Benz had sold the government. Borgwards were universally despised as owned only by the richest, stupidest plutocrats, for whom political correctness was uppermost. Still, no family, however rich, was so stupid as to own more than one.
The average Mexican had poorer physical conditions than the average American, by far. It seemed to me almost that the majority of Mexican people lived in spartan conditions, and many lived under extremely primitive conditions such as might be seen in the US only on Native-American reservations and a few other pockets of rural poverty. I wondered what could be done to equalize the situation.
Thinking upon the matter, it seemed to my simple young mind that we simply needed to readjust “the wages” that were paid to people in the US and Mexico, to bring them into harmony. I did not even consider how the money to pay the wages was in fact obtained, and that there was no mechanism for setting wages in either country. I could not even conceive that my parents were operating in a world so utterly chaotic. Surely such matters were under someone's control!
But indeed they were not then, and they are not today. The business of managing the world's money is in the hands of some people we call bankers, but less and less do I know what that word means. How it is that one man earns pennies for a day's sweat, and another harvests millions in a single transaction? How can money be so unjust? How can bankers justify these continuing inequities? Should not money begin to operate in a way that faciliates the ending of poverty, misery, of brutal resource competition that wastes lives in war?