Inverting the panopticon, Foucault
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Inverting the Panopticon:
Money and the Nationalization
of the Future
Gustav Peebles
All the stupidity and the arbitrariness of the laws, all the pain
of the initiations, the whole perverse apparatus of repression
and education, the red-hot irons, and the atrocious procedures
have only this meaning: to breed man, to mark him in his
lesh, to render him capable of alliance, to form him within the
debtor-creditor relation, which on both sides turns out to be a
matter of memory — a memory straining toward the future.
— Gilles Deleuze and Félix Guattari, “Savages,
Barbarians, Civilized Men,” in
Anti-Oedipus: Capitalism
and Schizophrenia
T
he national paper money that predominates across the
globe today is a relatively newfound phenomenon, as many authors have detailed
(e.g., Brantlinger 1996; Cohen 1998; Davies 1997; Dodd 1994; Eichengreen
1996; Hart 1986; Helleiner 2003; Ingham 2004; Sargent and Velde 2002; Spahn
This essay has greatly beneited from public presentations at Columbia University, Zagreb’s Mul-
timedia Institute, and the University of Chicago’s workshop on money and markets. I especially
thank Miran Bozicevic, Jessica Cattelino, Susan Gal, Anush Kapadia, Karin Knorr, Paul Kockel-
man, Kenneth McGill, Nene Panourgia, Rashmi Sadana, Natasha Schull, and Caitlin Zaloom for
their critiques and insights. I am also grateful for the excellent advice I received from Claudio Lom-
nitz and the anonymous reviewers solicited by the journal. Discussions with John Comaroff also
provided the original inspiration for this essay, and I would like to thank him for that.
Public Culture
20:2
doi
10.1215/08992363-2007-025
Copyright 2008 by Duke University Press
233
Public Culture
2001). However, some speciic and technical aspects of its emergence have
been neglected, and this has caused a failure to emphasize the manner in which
national money is the gradual result of successive open and agreed-upon contracts
between citizens, states, and banks, rather than exclusively the result of systemic
changes dictated from the top down. Following this long developmental process
starkly reveals the way in which the state comes to control semiotic processes, in
effect, appropriating an international sign of value held by its citizenry (e.g., gold
or silver) and replacing it with a national sign of value (paper or token coins). This
exchange of international and national signs, then, carries important consequences
for binding the citizens to the nation-state.
1
Whereas most studies of nationalism
contribute to our understanding of how citizens became tied to a convergent and
produced national
past
, the history of the emergence of national paper money will
show that it is equally important to consider the manner in which people became
bound, in unison, to the nation-state’s
future
.
2
In so binding the citizenry to the nation’s future, this paper money system in
turn contributes to the production of the spatiotemporal boundaries that mark
the nation-state. In effect, it creates a sort of inverted panopticon, wherein the
citizens must be constantly gazing back into the nation’s center, for their own eco-
nomic self-interest has now become attached to the management of the national
currency. Johann Gottlieb Fichte (discussed below) noted this power long ago,
explaining that such a paper currency could serve as the
sole method
to police
the borders of his recommended autarkic state; the people, out of their own self-
interest, would not transgress national boundaries, for fear that their economic
wealth would evaporate into a sea of nonrecognized signs abroad.
As Helleiner (2003) describes so well, economists and economic historians
have analyzed this system for a long while, referring to the “transaction costs”
of traversing from one currency into another. Building on the arguments of these
historians of national money, I am attempting to frame the discussion in terms that
become more useful and compelling to anthropologists, sociologists, and scholars
in the humanities. To do so, I am following not only Ferguson and Gupta’s (2002)
1. Roitman 2005: 48 – 72 has an important discussion of currency as a binding agent in a colonial,
rather than nation-state, context.
2. See the excellent volume edited by Sophie Day, Evthymios Papataxiarchis, and Michael
Stewart (1999) for many insightful ethnographies of groups of people who fail to follow the state’s
dominant “future orientation.” For detailed and insightful work on the manner in which inancial
instruments can bind people and spaces together, see Zaloom 2005 and 2006. A stimulating recent
forum in the
American Ethnologist
also tackles the question of how to grapple with the future as an
ethnographic object (see Guyer et al. 2007).
234
suggestion that we pay attention to the ways in which routinized practices contrib-
ute to the boundedness of the state, but also Guyer’s important recognition that
different currencies impose different temporal demands (1995: 1 – 26).
In order to clarify these arguments, I cover the seemingly unrelated set of
rhetorical claims and institutional practices that long sought to denigrate and
abolish individual hoarding practices. Indeed, across many countries during the
nineteenth century, the individual’s long-standing desire to keep watch over his
or her own money became marked as a “barbaric” survival that needed to be
banished from a properly civilized society. Such individuals needed to be taught
the difference between solipsistic hoarding and “civilized” pooled saving. Civi-
lized subjects needed to learn to trust social institutions, to accept a new division
of labor wherein the surveillance of economic value could be handed over to a
special class: bankers. And this special class would see to it that the money then
circulated in a more “rational” fashion, rather than merely moldering in a mat-
tress. Knut Wicksell, a vitally inluential monetary theorist of the turn of the
nineteenth century, succinctly encapsulated this opaque relationship between
individual savings and currency when he wrote, “We must, therefore, devote all
the more attention to the banks, which are in fact the heart and centre of modern
currency systems” (1967: 73).
Reviving the claims of important economists from the nineteenth and early
twentieth centuries such as Wicksell, I argue here that the slow separation of
individuals from their hoards constitutes an important chapter in the history of
national money. Indeed, early-twentieth-century economists went so far as to
heap opprobrium upon national gold reserves — those bedrocks of national cur-
rencies’ value for many years — as being mere “survivals” of individual hoard-
ing practices from a previous barbarian age, useless “remnants” that subsequent
enlightened scientists and statesmen would do well to abolish (e.g., Keynes 1971b:
236 – 42; Wicksell 1967: 124, 193).
Thus, esteemed people such as Karl Marx, John Fullarton (a prominent mem-
ber of the so-called Banking School of monetary theorists to whom Marx turned
frequently), Walter Bagehot, John Maynard Keynes, Wicksell, and Fichte all rec-
ognized the deep connection between shifting techniques for storing economic
wealth and the creation of national money. They were well aware that the paper
money that represented previously individual hoards had now migrated to the
banks. As I detail below, individual hoards gradually became part of private bank
hoards and, eventually, public national hoards; then, because of emerging practices
(and sometimes laws) concerning “reserve requirements,” the paper money that
was issued was intimately related to the totality of money that had been extracted
Inverting the
Panopticon
235
Public Culture
from individual hoards, now centralized in a larger “socialized hoard” (as Marx,
discussed below, would say). In other words, by following these theorists and
their documentation, one can see that history attests to the gradual creation of one
giant, national mattress. In the United States, this mattress is called Fort Knox.
This article covers, therefore, the manner in which institutional forms of sav-
ing money (instead of hoarding it) were created that became attractive at a crucial
moment in Europe’s and Euro-America’s climb to world dominance (the system,
irst consolidated in Britain, rapidly spread throughout other European and Amer-
ican countries). In effect, I trace the democratization of banking, the delivery of
new savings techniques to the masses that encouraged the replacement of the indi-
vidual hoard with a socialized one. In turn, these banks represented the democ-
ratization of capitalism itself, providing everyday holders of minuscule amounts
of economic value the ability to become embroiled in the giant, swirling system
of economic investment (see Wicksell 1967: 11 – 12). It is a remarkable moment
in history, when countless people were gradually convinced to “draw their money
out of the mattresses,” separate it from their individual surveillance, and hand it
over to a trusted social institution that would provide surveillance for them (and
a proit, as well).
The inception of the national reserves cum giant “hoard” therefore presents
people with a new bounded sphere of circulation that had never been present when
they carried an international sign of value in their pockets. As one “monetary
nationalist” asserted in the early nineteenth century, metallic money (viz., money
unattached to a reserve system) was too “cosmopolitan” (cited in Helleiner 2003:
114). In other words, such money allowed the individual user too much freedom
to determine where to use it. By eliminating transaction costs at the intranational
level, states instituted
new
transaction costs at the international level (when cur-
rency now had to be “translated”). In the process, these states thereby created a
new method of regulating the mobility of the populace and its capital, even if they
did so unintentionally.
3
3. People could, of course, still traverse national borders, but it now had an added cost and added
surveillance (discussed below). Furthermore, I am aware that even gold and silver money sometimes
needed to be “translated” abroad prior to the emergence of paper money, at, e.g., an assaying ofice,
for the mark on the money was unfamiliar to the new set of users. However, this translation remained
an individual decision between a currency owner and an assayer (as the vitriol of the mercantilists
proves), whereas paper money can be converted into another currency only under the gaze of the
state, which now has the power — not least via the management or mismanagement of its currency
reserves — to make paper money more or less attractive on the international market. Sweden’s 1992
raising of its interest rate to 500 percent serves as a particularly impressive example of how a state
might proscribe any and all translations (see Peebles 2004), but there are many others.
236
And thus, it may be worth thinking of the attempt to banish individual hoards
as a process of what Gaonkar and Povinelli (2003) refer to as “transiguration,”
wherein individual citizens become marked by way of indexicality and mimesis.
They continue: “But whether demanding environments are built to make one’s
life easier or harder to negotiate, one’s body seem smoother or more jagged, they
entail, demand, seduce, intoxicate, and materialize rather than simply mean. They
member subjects and tell them how to recognize something as something else
in various environments and with various values” (395 – 96). This last sentence
perfectly encapsulates the new relationship between citizens and money once
national money replaced international money. In Charles Peirce’s terms, the paper
(sign) was an indexical-icon of the socialized hoard (object), and if users (inter-
preters) failed to recognize the integrity or existence of the immobilized hoard,
the circulating indexical-icon lost all value; this indexical relationship between
sign and object then clariies that paper money can circulate only in a sphere of
users who grasp the semiotic relationship.
4
Simply put, the creation of a central
and immobilized “currency reserve” initiates a new set of monetary borders that
are different from the borders circumscribing money that circulates without a
semiotic relationship to a reserve.
5
As Deleuze and Guattari (1983) would say, these people became branded with
an object that forced them to strain toward a
particular
future and
particular
spatial borders. It is my contention that this process is initiated with the national-
ization of the currency reserves cum hoard, the moment when the state contracts
with its citizens to turn in (and immobilize) their international sign of value in
exchange for a (lowing) national one. By separating the value of money into
“reserves” and representations of those reserves, the modern era created what
might be called “alienated” money, that is to say, money whose “inherent” value
lay outside of itself. This bifurcation of value and sign in turn contributes to the
spatiotemporal borders of money, since money’s meaning becomes indexically
related to a physical object (imagined to be safely ensconced) in a speciic place.
Inverting the
Panopticon
4. Kockelman (2006) provides an excellent and very helpful set of guidelines for approaching
capitalist commodities with Peircian terminology. I also draw inspiration — in particular, the role of
trust in establishing monetary signs and circulation — from Wennerlind 2001. On money and trust,
see also Dodd’s seminal (1994) contribution.
5. This is true whether the reserves are in a local bank or a national one. When local private bank
money circulated, it, too, presented users with an even smaller set of boundaries. As Helleiner (2003)
astutely argues, one of the demands that drove forth national money was the desire to eliminate such
frequent transaction costs, when users had to constantly confront people who could not properly
evaluate the reserve cum hoard of any given private bank that may have been too distant.
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