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Earmarked money has a human face


The one thing about money we can all agree on is that none of us has enough. On a slightly more abstract and intellectual plane, most would also say that as money becomes the medium of exchange in more aspects of our lives, it tends to depersonalize and quantify relations with others.

Here's an example: If you want a new house built, you pay someone to build it. No more do you lay out a picnic lunch, invite the neighbors, give them some wood and nails, and let them throw something together. Obviously, your relationship with a paid builder is different than with neighbors who have just participated in a barn raising or house raising.

But Princeton University sociologist Viviana A. Zelizer begs to differ with the idea that after American currency became standardized near the start of the 20th century, it meant a head-first and all-encompassing careen toward greater commercialization and thus more impersonal lives. Even though a dollar is a dollar and more things had price tags, the author argues that people resisted the fungibility of money by designating money for different purposes and investing money with social significance in a variety of settings. In other words, Americans have tried to foist humanity onto the unfeeling greenback.

To buttress her thesis on the social meaning people have placed on money, the author focuses on the era from 1870 to 1930, when the monetized U.S. economy we know today really got going. She maintains that even as the currency became uniform and money invaded more aspects of our daily lives, "the forms of monetary earmarking multiplied."

Dr. Zelizer details the uses of money in family settings, as acceptable gifts (including tips and bonuses) and as assistance to the poor. The most interesting section is on domestic money, in which she chronicles married women's increased, albeit still limited, control over the family purse.

During the early part of the period studied, men fully controlled family money, usually parceling it out to wives in irregular (and parsimonious) gifts that the wives had to use to run their households. This later turned into regularly dispensed allowances to wives. These were first hailed as an advance, but by the 1930s Dr. Zelizer writes, the allowance "was changing from a sign of independence and domestic control to a form of financial submissiveness."

On gifts, the author describes how Americans turned the pieces of paper we call currency into something personal enough to be used as presents to loved ones. To be sure, the etiquette on when and to whom money can be given as a gift is elaborate and severe, and you're not supposed to use money received at a wedding for the next week's groceries. But her points on how people replaced a dollar's market value with sentimental value are well made.

Payments to the poor also have an interesting history. Such assistance was first made only "in kind" -- i.e., food and clothes, not money. That was based on the still widely accepted belief that the poor are less capable of making wise spending choices. Although there was movement toward money payments with fewer strings attached, food stamps are a good example of the type of "earmarked" money in which the author is interested.

While thoroughly researched and often illuminating, the book doesn't fully back the author's more far-reaching claim: "that the earmarking of informal monies is a phenomenon as powerful as the official creation of legal tender." At most, Dr. Zelizer is successful in showing that the advance of money into our society was not a monolithic blitz, sweeping away all specialized economic relations. But the areas she focuses on -- family, gifts, welfare -- are sideshows to the main economy, where indeed money has made relations more regular and impersonal.

Money today is much more of an abstraction than in the 1930s. In worldwide markets, billions of dollars move from country to country, from stocks to bonds, from currency to currency, in minutes. In personal affairs, computer-assisted payments satisfy monthly bills and widespread use of credit cards makes relationships more abstract.

There may have been a sound academic reason to limit the study to 1870-1930, but the decision reduces the book's relevance to the general reader. For example, there is no effort to track the evolution of domestic financial relations to the present day, in which a much bigger percentage of women is in the salaried work force.

Dr. Zelizer's range of research is impressive, with sources such as legal cases and popular magazine articles of the day. But often the directly quoted citations lead to choppy writing. There's also too much repetition and abstract language. Still, this a valuable contribution to our understanding of money: not so much how it's changed us, but how we've changed it.

Mr. Lipschutz is a writer who lives in New York.

Title: "The Social Meaning of Money"

Author: Viviana A. Zelizer

Publisher: Basic Books

Length, price: 286 pages, $24

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