Evils Of Money
Though money plays a very significant role in the modern economic life but money is not without evils. If money is not managed properly, it may lead to several evils effects.
"Money is a valuable though dangerous invention."
"Money is a good servant but a bad master."
"Money is a necessary evil."
"Money, which is a source of so many blessings to mankind, becomes also, unless we control it, a source of peril and confusion."
The following are the main evils associated with money:-
(A) Economic Evils,
(B) Social Evils.
(A) Economic Evils
Money has Promoted Economic Inequalities:
Emergence of monopolies and concentration of wealth in the hands of a few, made life difficult for the rest of the society. Social injustice and economic inequality is the outcome of money. Money has proved a convenient tool for acquiring wealth and the exploitation of the poor by the rich. It has created a big gap between the rich and the poor.
Money Creates Class Conflict:
Money has been the basis of the birth of a capitalist society. In a capitalist society the means of production, factories, farms etc. are in the hands of the private individuals and firms. Capitalism has given rise to class-conflicts'. The society is divided into two classes the 'haves' and the 'have not'. The exploitation of the have-not by the haves has given rise to social unrest which is considered to be an evil of modern times.
Money Strengthens Capitalism:
It is money which has given birth to credit. On account of credit, the rich businessmen can obtain borrowed funds for expanding their enterprises. Capital gets concentrated in the hands of a few rich people. This gives rise to glaring inequalities in the distribution of income and wealth in the economy.
Instability of Money:
A serious defect of money is that its value of purchasing power does not remain stable or constant. Different sections of people in the country are affected differently because of fluctuations in the value of money. For instance, a fall in the value of money (inflation) leads to distortion, in the distribution of income since the rich become richer while the poor become poorer; a rise in the value of money, meaning fall in prices and employment, may lead to general pauperisation of all classes of people.
"Over Capitalisation' and 'Over-Production':
Money encourages over capitalization. With the invention of money, borrowing and lending operations in business have became common. Some businesses utilize more capital than necessary that given rise to the problem of over-capitalization. Over-capitalization results in over-production which creates a number of problems in the economy like steep fall in prices, unemployment and recession.
Money Generates Trade Cycles:
The trade cycles are always in operation in a capitalist economy. Boom period follows slump and slump follows boom. This generates instability in economy as a result of which different sections of the community are put to difficulties and inconveniences. In fact, money is responsible for the operation of the trade cycle.
(B) Social Evils
Following are the social defects of money:-
- Money is directly responsible for the decline of spiritualism in modern society.
- Money has encouraged greed and acquisition.
- Money has encouraged fraud, thefts, dacoity, murder etc.
- Money creates in men the desire and urge to exploit others.
Money has thus become the root cause of all social evils. It has resulted in a serious decline of moral standards. In fact money has become a curse for the society. But the fault lies not in money but in human nature.
Money is a Good Servant but a Bad Master:
Money in itself is not bad, but its possession in a wrong way leads to many evils. Money serves our society in innumerable ways. Money is made for man, and not man for money. If we are able to give money its proper place, it cannot become a bad master.
Money has removed all the inconveniences of barter. Money has proved as an extremely valuable instrument beneficial to the society in general. It possesses many of the elements of good money. But money suffers from several disadvantages and evils, most important being inflation or rise in prices. But this problem can be eliminated or reduced to the minimum, if money material is properly managed. The evils of money, of course has highlighted the need for putting the country's fiscal conditions in order.
