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OpEdNews Op Eds    H3'ed 6/1/12

The Instant solution to the new Depression: debt-free money

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Two deeper First Principles questions of the world's political leaders must be asked even before this one.

1. Are there jobs to be done?   If the answer is no, immediately book a plane to whatever country that leader represents, because obviously they are living in Paradise, where no one lives in poverty, no one grows old or sick, the roads are perfectly paved and ridden over by driverless non-polluting cars dropping the kids off at schools where learning is so fun and efficient it only needs to be held 3 days a week -- a good thing, since that's all their parents have to work, though they are doing such interesting jobs they typically take a second job just for the pure enjoyment of it, since they no longer need money!

2. Are there people who want to do the jobs?   Don't let the leaders weasel out of this by saying "oh, yes, but there is no money?"   That is not the question!   The question is, "Are there people who want to do the jobs?"   Education too, comes with work experience; no one walks into a new job perfectly trained.   That ought to go without saying.

So, what is stopping people from doing jobs they want to do, that must be done?   Money.   That's all.   Little green pieces of paper.   Who controls the money supply?   Banks.   They create money whenever they issue loans.   And please, none of this false argument about lack of demand.   Are slaves denied freedom because they don't have enough demand for it?   Are poverty-stricken children denied food in their bellies because they haven't asked hard enough?   Are small businesses unable to get off the ground because they lack the products and services that people want?   Really?   What about an electric car that goes 300 miles and charges in 5 minutes?   What about better, healthier food and new exercise facilities for today's increasingly obese children and adults?   Here are some others.   I'm sure you could come up with a dozen or so things we need in 5 minutes, that we would have if the money was there.

Well, why should the banks decide where money should go?   Have they done a good job so far?   Have we not just had the mother-of-all-housing busts, caused by speculation and short-sighted greed?   Are we really "short of money" when the world derivatives market is estimated to be worth up to $1.2 quadrillion, some 20X the world GDP?   What does money even mean in that context?   Shouldn't money have some relation to actual wealth?   Isn't wealth not just numbers on a screen, but something like those things and services that meet human desires, produced by labor and using the fruits of the Earth?   Don't we all have a human right to fruits of the Earth, equally, just because we are human?   More on that in a moment. 

One of the themes of the recent PBI conference was the question of returning production of money back to a Public source, like government, or a Public Bank accountable to government.   This "Public Option for Money" as Max Keiser called it when he interviewed me three years ago, would be a counterweight to the private creation of it now.   Any money produced by government would be, by definition, debt-free (petition: end-the-debt-crisis-with-debt-free-united-states-notes ).   It would be an immediate credit to the government account.   By retaking this seigniorage right, governments could say to the banksters "We don't need your money.   We have the sovereign right to create our own!"   This is a historical right of governments throughout history.   It has, is, and can, be done in America from the very beginning.   The coins you carry in your pocket were produced debt-free, as are the stamps you paste on your envelopes.   You can no more run out of coins and stamps due to a debt than you can run out of points in a football game.   The same was true of a special kind of paper money -- United States Notes -- first produced by Lincoln in 1862 to fight the Civil War, and again for 14 total series through 1972, until the Treasury, in false complicity with the banking establishment, said there was no functional difference.   In fact, money issued by the Federal Reserve cannot perform the same seigniorage function as government-issued money, and anyone who says it can either doesn't understand the difference or even profits from it.

Now, simply producing debt-free money and putting people to work with it will only get you so far.   Yes, it will bring down unemployment and create millions of jobs in public works, as it did in Franklin D. Roosevelt's time, only this time, without debt (taxes are not a debt, they are an obligation of citizenry for supposed public benefits that has no real connection to the creation of money.   Government could, in theory, simply fund itself through Greenbacking -- the act of creating debt-free money, without taxes at all).   If all you do is feed money into society from a government source, it will continue to "trickle up" (more like a gusher, lately) to the top 1% in the form of Economic Rent.   To really end the monopolies and speculation that lead to such vast wealth inequity, one must tax the Land (in classical economics, Land means ALL of nature's resources).     Otherwise, the hoarders and speculators will eventually get all the surplus from production, making money while they sleep.   The ideal form of tax should be one that does not discourage production but encourages efficient use of the finite resources of the Earth.   Only the Land Value Tax, aka Single Tax, aka Land Value Collection, does that.   This leads to the uncovering of Big Lie #3 - that the Earth is insufficient to provide for our needs.   No, the best locations and natural resources are hoarded by a very few, until they find a price they want to sell it at, under-taxed on their holdings, and allowed to impoverish billions.

End the monopoly and Land and on Money and we will be living in a very different world. Maybe one that truly would be Paradise.

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Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a former blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles "America is Not Broke" was published by Tayen Lane Publishing (March, 2015) and may be found here:
http://www.americaisnotbroke.net/

Scott is a former and current President of Common Ground-NY (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written dozens of (more...)
 

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