John Lockes Notion of Money - Essay Example

? John Locke’s Notion of Money In John Locke’s Second Treatise on Government, the English philosopher defines money as “a little piece of yellow metal, which would keep without wasting or decay [and] should be worth a great piece of flesh, or a whole heap of corn” (Locke, Second Treatise V.37). This means that, for Locke, money is a good method of exchange because money does not decay unlike good like flesh or corn. This also means that money has value and it is a permanent way to determine value because it does not decay. Locke also believes that money is a means of assigning value to one’s property or possessions. He bases this idea on the definition of labor. According to Locke, “The labor of his body, and the work of his hands, we may say, are properly his” (V.27). This means that if one labors for something, that something naturally becomes his property. Therefore, labor determines property. This property then is assumed to be useful and “the intrinsic value of things…depends only on their usefulness to the life of man” (V.37). Therefore, property has value, and this value can only be represented by money. Therefore, if one has money, even if the property is gone, its value stays with its rightful owner. Furthermore, this means that since money does not decay, then it does not lose its value. In fact, money does not only have value but it also serves as a pledge or an agreement among people that they will honor its value through “mutual consent” (V.47). Lastly, according to Locke, money is a means to “enlarge” man’s possessions or property (V.48). Since money became a means to exchange useful goods and since different industries developed to give man different amounts of possessions, money became a means to own larger and larger property. If a man has more money than his neighbors, he will naturally have larger possessions because he has more right to acquire more value and naturally more property (V.49). Aristotle’s Notion of Money For Aristotle, money is a means to establish equal and just reciprocity. This reciprocity is “in accordance with a proportion and not on the basis of precisely equal return” (Aristotle, Nicomachean Ethics V.2). This means that the society needs money so that we can exactly determine the value of every exchange. If we rely on barter, we cannot exactly know how much of one thing can be justly or rightfully exchanged with another. Therefore, for Aristotle, “all good must…be measured by some one thing” and that only money can serve as a standard or it can provide the means to an equal exchange of goods (V.3). The idea of equal exchange is based on Aristotle’s idea of justice, which is the topic of the whole Chapter 5 of the Nicomachean Ethics. For Aristotle, the reason why money should be used as a basis of equality is that it is fixed and more stable than other criteria. For example, nobody can exactly say who is virtuous and whether virtuous people must receive more that those who are not. Money, however, is fixed and will give its owner the same value whether he is “more virtuous” than another person. Aristotle also states that money is “not always worth the same; yet it tends to be steadier” (V.3). This means that the value of money may change but it is still a better mode of exchange because it is not perishable. Moreover, money is “our surety,” which means that money is a guarantee or a pledge that its value will be honored by all men as it is “fixed by agreement” (V.3). This also means that even if now we do not need to use a product that money can buy, the fact that we have money means that we can still use this product in the future when we need it. Aristotle and John Locke on Money Aristotle and John Locke both have similar and different opinions on money. Nevertheless, Aristotle’s views seem more viable. Both philosophers believe that money is more or less a practical mode of exchange. According to John Locke, money does not decay like perishable goods such as corn and flesh. In fact, he defines money as “a little piece of yellow metal, which would keep without wasting or decay” (Locke, Second Treatise V.37). Aristotle’s philosophy also somehow agrees with Locke when he states that money is “not always worth the same; yet it tends to be steadier” (Aristotle, Nicomachean Ethics V.3). This quality of permanence ascribed by the two philosophers to money somehow gives money this practical use as a mode of exchange. However, there is a difference in the reason why John Locke and Aristotle came up with a statement like this about the permanence of money. For John Locke, goods are perishable and thus cannot be made into a mode of exchange, while, for Aristotle, different goods are hard to measure and their values are hard to equate without a standard like money (V.3). Therefore, for John Locke, the permanence of money is more of a practical reason, while, for Aristotle, the permanence of money is a method of bringing forth equality in exchanges, thus constantly upholding the idea of justice. Aristotle therefore regards money in a nobler way. Perhaps a striking difference between the ideas of John Locke and Aristotle regarding money is on the specific function of money. John Locke emphasized the idea that money can enlarge or expand one’s possessions (Locke, Second Treatise V.48). This is more of a practical rather than a noble regard for money. Moreover, he turned pessimistic in the latter part of Chapter V of the Second Treatise when he stated, “there is land enough in the world to suffice double the inhabitants, had not the invention of money, and the tacit agreement of men to put a value on it, introduced…larger possessions, and a right to them” (V.36). Perhaps what John Locke is saying here is that money is not really that good since its existence and its value eventually caused the ownership of larger and larger property and the ownership of the rights to such property. This somehow gave birth to capitalism in society. Since some people began owning large property, the rest had to work for them and therefore had relatively smaller property. Therefore, for Locke, the invention of money brought with it capitalism, slavery and some sort of injustice. This could be true but it is pessimistic and offers no hope to the world. On the other hand, for Aristotle, money “makes goods commensurate and equates them” (Aristotle, Nicomachean Ethics V.3). The idea behind this equality is the idea of justice, and this is emphasized by Aristotle in the first part of Chapter V of the Nicomachean Ethics. Therefore, for Aristotle, justice is the idea behind the existence of money as a mode of exchange, and that without money this justice in the exchange of goods and services would not be carried out efficiently. Therefore, if money does not exist, there will always be injustice because there is no one standard to measure the value of goods. What Aristotle says is true in the very sense of the word. Anarchy and chaos will be the result if society does not honor money anymore, and there will be conflicts everywhere. Aristotle’s idea on money is more optimistic than Locke’s. Aristotle’s belief that money is a means to justice is very true and very much real. With money, exchanges are honored and there is no way that an unequal exchange can take place. With money, every good and service that resulted from one’s labor is honored. However, based on Locke’s ideas, money is more like an instrument of evil – in eventually promoting injustice in the world. In my opinion, money is a mere instrument of man and it is man himself, not money, who acts and eventually does right or wrong to his fellowman. A Summary of Frederick Pollock’s “Locke’s Theory of the State” Frederick Pollock’s “Locke’s Theory of the State” is an account of how Locke believes an ideal state should be and contrasts it with Hobbes’ idea of the state. Locke based his theories of the state from his belief that the people of England have a “love of their just and natural rights” (Pollock). This love of the just is the same as the desire of the people to preserve the state by any means necessary. However, for Locke, the preservation of the state cannot be carried out if the type of government is an absolute monarchy like what Hobbes demonstrated. Locke believes that “all men, as sons of Adam, [must have] a natural property, right, and freedom which could be duly exercised only in a pure democracy” (Pollock). Therefore, for Locke, democracy is the best type of government because in democracy everyone is equal and no one has any natural right to be more superior to others. Moreover, this law of equality is even an obligation that is “binding on princes” (Pollock). This means that even princes are not immune to this rule of equality. Perhaps the greatest difference between Locke’s theory of the state when compared to Hobbes’ is the idea that the natural right of preservation of man makes him entitled not only to preserve himself but also “to preserve other men” (Pollock). While Hobbes believes that man has a tendency to preserve himself alone, Locke believes that man also has the tendency to preserve even others because “his own preservation comes not in competition” (Pollock). By preserving others, man eventually lessens the possibility of conflict that can destroy him. Besides, even though man has a natural right to preserve himself, Locke believes that the “authority of the Scripture” is higher than this natural right (Pollock). This means that conscience will always be a part of man’s natural state. Lastly, Locke’s theory of the state emphasizes arbitrary power over absolute power. In the case of absolute power, the sovereign has the right to do whatever he wants to do with the citizens. However, with arbitrary power, the sovereign knows that it has the right to do anything in his power but he chooses, perhaps for his own benefit, not to exercise certain powers. There is democracy and benevolence in Locke’s theory of the state. Top of Form Bottom of Form Works Cited Aristotle. Nicomachean Ethics. 2009. The Internet Classics Archive. 28 Feb 2011. < http://classics.mit.edu/Aristotle/nicomachaen.5.v.html> Locke, John. The Second Treatise of Civil Government. 2011. Constitution Society. 28 Feb 2012. Pollock, Frederick. “Locke’s Theory of the State.” 2012. McMaster University. 28 Feb 2011. Read More