Possession emerges at a very low rate of surplus activity. At this stage, small possessors cannot yet achieve a sufficient rate of surplus activity to set in motion a cycle of expanded self-reproduction; the appropriation of surplus activity/product remains the prerogative of the state and the nobility, who collect the surplus and spend it on status consumption (palaces and temples) or large-scale structures and administration (irrigation systems, standing army, tax apparatus, etc.):
“At the time of the Spanish conquest the Texcoco, Chaco, and Xochimilco lakes had about 12,000 ha of chinampa fields. Their construction required at least 70 million man-days of labor. The average peasant had to spend no less than 200 days a year to grow enough food for his own family, so he could not work more than about 100 days on large hydraulic projects. As a good portion of this time had to be devoted to the maintenance of existing embankments and canals, seasonal labor of at least 60 and up to 120 peasants was needed to add 1 ha of a new chinampa. The means were different—but the pre-Hispanic basin of Mexico was clearly as much a hydraulic civilization as Ming China, its great Asian contemporary. Long-term, well-planned, centrally coordinated effort and an enormous expenditure of human labor were the key ingredients of its agricultural success” (Smil 2017, p. 99).
The complication of activity implies an increase in mediation, i.e. a growing mass of meanings materialized in the means of activity. A growing meaning mass per unit of product affects both the production of consumer articles and the making of means of production (investment). The prerequisite for increasing mediation is accumulation—saving surpluses and investing them in means of production. Accumulation implies that both the means of production and their making become more complex and the composition of meaning is higher. More complex means of production require broader cooperation and more sophisticated administration.
“Undoubtedly the most important, and lasting, contribution to intensified cropping in China was the design, construction, and maintenance of extensive irrigation systems. The antiquity of these schemes is best shown by the fact that nearly half of all projects operating by the year 1900 had been completed before the year 1500. The origins of perhaps the most famous one, Sichuan’s Dujiangyan, which still waters fields growing food for several tens of million people, go back to the third century BCE. … The construction and unceasing maintenance of such irrigation projects (as well as the building and dredging of lengthy ship canals) required long-range planning, the massive mobilization of labor, and major capital investment. None of these requirements could be met without an effective central authority. There was clearly a synergistic relationship between China’s impressive large-scale water projects and the rise, perfection, and perpetuation of the country’s hierarchical bureaucracies” (Smil 2020, pp. 93-94).
Investment is, by its definition, not production for consumption, since it is aimed at producing means of production and not consumer articles. The larger the investment, the less it is production for consumption and more it is production for exchange. Robert Lopez showed that although water mills were already used in antiquity, their relatively high cost meant that they did not spread in Europe until the Middle Ages, when slave labor was transformed into peasant labor. Greater freedom was a condition for greater efficiency. The deficit of slave labor forced the search for mechanical methods of grinding grain, while at the same time the lord of the manor forced the peasants to grind their grain in his mill. The shortage of rivers and streams to support waterwheels, in turn, led to the spread of windmills, which were not used in antiquity (Lopez 1976, pp. 43-44). An increase in meaning is an increase in mediation, the latter requires more freedom for the subjects, and more freedom requires a more complex socio-cultural order.
Property, debt and interest
Property arose as the disposal of the non-user in parallel with and in place of possession as the disposal of the immediate user. If the origin of possession is to be sought in the possessor’s own labor, then the origin of property is to be sought in political and economic norms. Property arises as political property when one group of people is able to subjugate another group, when one part of the population rises as a political force over another part. Property makes it possible to create elaborate means of production, to invest on a large scale, to maintain a sufficient duration of the production and circulation, to calculate and distribute risks. If possession is a feature of a low composition of meaning, then political property is a feature of an activity with a high composition. Political property is associated with the rise of chiefdoms and states. Irrigation systems, military installations, massive ancient and medieval architecture are its material evidence.
“Thus, in tribal hydraulic societies property is simple, but it is simple with a specific tendency toward the predominance of political, power-based, property. This tendency increases with the size of the community. It becomes decisive in simple hydraulic commonwealths that are no longer directed by a primitive (tribal) government, but by a state” (Wittfogel 1957, p. 238).
Changes in the rate of surplus activity, in value saving and investment, draw a line between application, possession and property. The value of a surplus product is a “quantitative expression” of disposal and use: the transition from application to possession and from the latter to property is associated, first, with an increase in the size and rate of the surplus product, and, second, with a shift in the mechanisms of alienation and appropriation of the surplus product—from brute physical force to customs and from there to laws. Political ownership enables the appropriation of the surplus activity or its product in direct natural form—for example, in the form of corvée labor or rent in kind.
Simple self-reproduction is characterized by unstable accumulation. Periods in which increased surplus allows the large-scale making of means of production—irrigation systems, for example —are often followed by periods in which what has been achieved is consumed and destroyed. The very structure of the traditional order, with its political ownership, its communal and private possession, implies that investment is either reduced to the activity of the all-powerful king (or chief), who is unable to implement the many projects necessary for the division of meanings, or that investment is reduced to the petty activities of individuals and families who cannot raise enough funds for significant projects.
Appropriation in kind contains a contradiction in itself: on the one hand, it is a condition for the existence of the polity; but on the other hand, by appropriating labor or its product in kind, the polity hinders the development of a competitive commodity exchange. Overcoming this contradiction required the transformation of political or state property into economic or private property, the development of written laws, fiat money and interest.
Gunnar Heinsohn and Otto Steiger showed that debt and interest arise when possession turns into private property. In their view, possession is a physical or material concept, while property is an immaterial or legal concept:
“Possession always means the right to dispose of certain goods or resources and thus to use them physically, and is independent of whether property rights exist or not” (Heinsohn und Steiger 2009, p. 91). “Property never arises naturally. It can only be created by a legal, i.e., non-material action. Once property is created, it carries an unearned and intangible premium, the property premium. This premium exists in addition to the physical use of the goods or resources held and consists of two forces: (i) it is capable of supporting the issue of money, which can only be created in a loan agreement, and (ii) the right to this premium serves as collateral to obtain a loan” (ibid., p. 471).
Since its very inception, money has served the purpose of accumulation, i.e. saving and investing value. For a long time, this function was limited to precious metals as a tangible form of money. Fiat money emerged with the advent of credit. Medieval states needed money for their projects, especially to wage war and pay mercenary armies. They obtained money by borrowing it from creditors. However, political property is the prerogative of the state, and the sovereign often considered what he had borrowed as his property, i.e. he did not repay the debt. Creditors, suffering from the arbitrariness