Josh Mason and I have been debating since my critique of David Graeber’s Debt went online a few weeks ago. We started at Crooked Timber — completists can read the original comments box exchange here.

At that point we switched to email, with several lengthy back-and-forths — the total wordcount a multiple of the original Jacobin piece. His post here at Jacobin sets out his position in the email exchange, and here I’ll set out mine. Throughout it’s been a friendly and productive discussion, and I’d like to echo upfront Josh’s kind words — I don’t think there are many economists of our generation I feel more in tune with, and if you don’t already read The Slack Wire, you should. As he said in the post yesterday, we’ve found a lot of common ground, but he intended to focus on the published piece as pose his disagreements as sharply as possible, even though that “doesn’t imply any larger divide between us.” This reply is in the same spirit.

The debate between Josh and I centers on the question of whether or not the distinction between a “commodity/fiat money economy” and a “credit money economy” is a useful one in understanding our present economic system and its history. He thinks it is so useful as to be the central dividing line in economics; I think it is liable to mislead. The rest of the disagreement comes, I think, because Josh conflates the commodity/fiat-credit money economy divide with other divides in economic thinking. So he seems to that if I challenge that distinction, I must be a quantity theorist, must believe that money is simply a veil, neutral in its economic effects, and must misunderstand how banking works. In fact we are on the same side in all those other dichotomies, but Josh for some reason continues to maintain that if I disagree over the core distinction, I must be standing on the other side of all the others. In what follows, I’ll establish (1) why I think the “commodity/fiat money economy” — “credit money economy” divide is a problem; and (2) that the rest of his criticisms rest on the conflations with other theoretical dichotomies.