Debt-free sustainable currency for the people by the people

As someone who have been engaged in educating people on the importance of looking at the blindspots of capitalism  and the sytemic  problems  inherent with debt-based fractional reserve based  centralized  commercial  banking system  that is mathematically unsustainable, I feel….

we urgently need a fair, transparent inflation free and sustainable debt-free people controlled currency system for addressing myriad systemic problems deriving from concentration of wealth in the hand of few thousand at the expense of billions of people. The very perception and definition of money must change to bring balance in all human endeavors and restoration of peace, justice and basic human rights to live with dignity, basic necessities, universal health care, education and such. You are welcome to explore my new blog on deep conscious capitalism

Thanks GW, Janos and others for this pod of “evolutionaries” as janos suggested. An interesting Open Roundtable (unlike one by Cecil Rhodes)

Merry Maiden
Mita

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Debt-free sustainable currency for the people by the people

Susmita,

This is mandatory.  Not only will our business models have to be evaluated, but a system of exchange based on debt is … unconscionable.

I have read about systems not based on debt, but can't recall where nor what the title was.  I'm sure you know.  Would you please research this and post about it?  We certainly do need to discuss this.

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Re: Debt-free sustainable currency for the people by the people

Susmita et al,

I hate to defy the common HR mantra “You can't argue with someone's feelings” but:

Where markets exist the idea of debt will exist. I have argued both for and against capitalism with friends and business associates. As a system of social equality it is unrivaled in it's simplicity and efficacy. Concentration of wealth is inevitable where there are market systems and forces.  Providing basic necessities to all in the context you discuss is a social issue, not an economic one. Creating a currency that does not lose value relative to other currencies or to itself over time (inflation/deflation) requires ONE universal currency, or a world that does not ever change and goods are never in short supply.

As an aside, I don't understand the allure of a gold plated codpiece, I do believe in the right of someone to buy one. I believe their rights extend into the world of how they treat others, and thusly how they earn and spend their money. And with all of those rights includes the right to be indebted and to be a lender. Socially these systems evolved into the things they are because they are superior and inclusive of prior systems and institutions. Designing the next institution must include the benefits of the current system as well as some emergent properties that from my perspective do not include many modifications to the currencies currently traded. I suspect at best we will evolve to a two or three currency system as a species as the ability for any one country to wield economic power (a la the formation EU) will erode as more countries create collaborative economic power bases.

Kindest Regards,
Wiseman

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Re: Debt-free sustainable currency for the people by the people

Hi Wiseman.

I don't really find debt on a personal level as objectionable as national debt.

Though I definitely think usury (debt with outrageous interest rates and fees) is deplorable whether it's perpetrated against individuals or entire nations.

And I also have tremendous distaste for any form of lending where someone profits off of the misfortune of someone being too poor to have the resources to pay back the loan immediately - meaning the poor are unfairly forced to pay more, simply for being poor.  (And they could be poor for any number of reasons which are wholly outside their own control and responsibility - such as being born to a poor family or in a poor country).

The only reason I think national debt is worse than garden-variety loan sharking against individuals, etc. (such as by payday loan lenders and credit card companies), is because national debt is on a far larger and probably far more destructive scale.

For instance, apparently various struggling Third World countries are crushed with the burden of “debt repayment”:

From http://www.globalissues.org/TradeRelated/Facts.asp :

Quote:

The poorer the country, the more likely it is that debt repayments are being extracted directly from people who neither contracted the loans nor received any of the money.

Quote:

The developing world now spends $13 on debt repayment for every $1 it receives in grants.

And here's another horrifying article:

http://bingol.mydd.com/story/2007/4/29/191949/165


Also, the way money is created in the USA appears to be quite nonsensical.

I'm not sure if I understand it correctly, but I've watched a couple documentaries which seemed to clarify matters a bit (not sure how accurate and credible they are, though):

* America: Freedom to Fascism - entire documentary viewable here: http://video.google.com/videoplay?docid=-1656880303867390173

and

* Money As Debt - entire documentary viewable here: http://video.google.com/videoplay?docid=-9050474362583451279

I sure wish I could get a transcript of those - my memory is like a sieve when it comes to videos, and it's so much easier to refer back to something which is written than which is in video form.

Anyhow, though - if I understand the first documentary correctly, it appears that instead of America's government printing its own money, debt-free and interest-free, the government gets the money from a private bank, the Federal Reserve, to which the government ceded its Constitutionally-granted power to coin money in 1913 - and the Federal Reserve holds the government in debt and charges interest.

And if I recall the second documentary correctly, it explains how money is created by banks putting out loans.

I'm not sure whether the documentary mentioned the following or if this is an idea I myself came up with, but it seems like it would be far better for money to be spent, or paid, into circulation, debt-free, not lended.

Especially since there apparently simply isn't enough money in existence for everyone to be able to pay back their loans, plus interest - and get free of the slavery/indentured servitude of debt.

The only form of debt I find truly unobjectionable is debt which involves no interest and fees, with the lender getting back precisely what they gave, no more.

As in, the lender pays me $5, I pay the lender $5 - not, the lender pays me $5, and I pay the lender $25, which the lender didn't do nearly enough to earn or deserve, and which strikes me as a case of the strong, rich and fortunate taking unfair advantage of the weak, poor and unfortunate.

OK, there are my thoughts. :-)

Best wishes,
Apollia

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Re: Debt-free sustainable currency for the people by the people

Wiseman and Apollia please browse the first 4 links on the side including my quotes page, pod, article and a youtube video money as debt in my blog

This is quite an involved issue requires at least a week of study to sort out the issues.
There were many instances historically of debt-free public money including in our own nation
before the American revolution called colonnial scrips and later issued by by Lincoln called Greenbacks, first one helped birth a nation (free from British money) and the other saved the Union (Lincold didn't have to borrow foreign money to win Civil war and probably had to be killed because of that). Also hear what Ron Paul is saying on FED. It may be shocking, but that's the point. More later.

Cheers

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Re: Debt-free sustainable currency for the people by the people

Thanks, I've skimmed them a bit so far.  Excellent stuff.  :-)

I love the quotes page, and hope I'll have more time to read the article in the future. I've already been a part of your pod for quite some time (but still haven't gotten around to reading as much of it as I would like). And, we linked to the same video. :-)

I would suggest uploading the PDF article as a regular web page, because many people can't stand PDF files (as explained by web usabiliy guru Jakob Nielsen in this article), and a web page will be more easily browsed in someone's web browser.


I wish I had more time to go over everything in depth, but, my own financial problems are beleaguering me.

One of the sad consequences of my financial difficulties has been that I'm scarcely able to study anything with nearly the depth and breadth that I would like, due to having to worry so much about money.  (And when I do get anything done which doesn't directly relate to improving my financial situation, it's at the expense of my financial situation remaining the same, or worsening).

I think that's probably the case for a lot of people.  If you're too busy frantically trying to get enough money, you don't have much time left over for things which aren't (or seem like they aren't) immediately relevant to assuring that you have the basic necessities.

It can be very hard to focus on abstract-seeming, complicated theories about money if you're hungry, and various major bills are coming due, etc., etc.  (Unless you're someone like me, with a ridiculous capacity for focusing on things which are of little immediate practical use or benefit to me personally - at the expense of the practical facets of my life. :-) ).


In the end, I think what it may take to rally and organize many people may be to offer them some practical solutions and help on a material level. (Which is basically the point of my pod.  Sorry, couldn't resist plugging it yet again… :-) ).

I have a relative who has studied psychology, and, while I am far from a worshipper of psychology myself, I did find what she said about the psychological concept of Maslow's hierarchy of needs interesting, because it seems to me to make a certain amount of sense - since it basically states the rather obvious common-sense idea that your basic needs have to attended to before you can comfortably turn your attention to matters beyond mere survival.

I think at some point some effort will need to be made to rescue people from their survival-level concerns, by giving them actual material help.  I think the reason there is largely so much apathy and inertia when it comes to social change, etc. is because so many people are struggling, completely preoccupied with their own extremely pressing and hard to fulfill basic needs, and just trying to keep treading water.

I think it's only when people no longer have to worry about basic survival issues so much, etc., that it is likely that they will become really interested in abstract-seeming theories about money, and in working to change these currently rather obscure, not very well-known, but definitely vitally important issues.


Very interesting history in your post, and it' s nice to hear that Ron Paul is speaking up against the Fed (by which I guess you mean the Federal Reserve).

I forgot to mention before that for the most part, I agree with you and Keith.

And I think Wiseman makes some interesting points.  But I think the problem of debt is definitely much more far-reaching than people going into debt for the sake of buying frivolous purchases - as many people have to go into debt simply to obtain basic necessities, like food, health care, outrageously costly education so they have a prayer of a decent job someday, etc.

Also, if the America: Freedom to Fascism documentary I mentioned above is correct, then, income taxes are a debt-related issue, because apparently income taxes are for the purpose of paying back the debt and interest America supposedly owes to the Federal Reserve.


On the topic of debt-free, inflation-free, tax-free sustainable currency - I actually wrote a bit which relates to this topic at the Skeptico blog:  http://skeptico.blogs.com/skeptico/2007/06/secular_religio.html

I made a variety of comments on that blog post, but in this particular comment, I mentioned a perhaps rather far-out idea inspired by Second Life, an online virtual world game which has its own virtual currency which can be exchanged for real money.

Actually, I think I'll just quote that right here.

Quote:

OK, now here's a perhaps rather goofy far-out idea I came up with myself, in the process of trying to think up other ways for governments to possibly get by without income taxes… :-)

There's a massive multiplayer online virtual world game I sometimes play called Second Life, which has its own virtual currency and a currency exchange, so you can actually trade out your Linden $ (L$) for real US $. Because of this, some people actually make a living via Second Life, such as by creating and selling virtual objects, etc.

Second Life doesn't have any income taxes. (Though if I'm not mistaken they experimented with having a tax system of some sort years ago). They have many customers (“premium users”, virtual land/island owners, etc.) who happily pay US $ subscription fees. They don't need L$ from the people to operate - if they really needed L$ for something, they could always simply create their own L$ out of thin air - so taking L$ from people against their will is unnecessary.

The biggest danger facing their virtual economy might be the problem of inflation, but they manage to control inflation by charging for certain services which people want and need, which serve as L$ “sinks”. If you upload an image, animation, sound, or run a classified ad, that costs you some L$ - and if I understand it correctly, that takes the L$ you gave them out of circulation.

Perhaps real governments could do something similar - have no income taxes, print its own money (meaning they'll never be short on cash to fund various things - if they need more, all they have to do is print more). And then, to control inflation, the government can have its own money “sinks”, where any money that is paid to the post office, or to toll roads, or to the NASA gift shop, or whatever :-), is taken out of circulation.

Just a far out idea… :-) I wouldn't go so far as to claim it definitely would work, but I think it would be interesting to see what might happen. The virtual economy of Second Life seems to work pretty well - could something similar possibly work with real governments and real economies? I wonder what kind of experiment could be designed to test how the above far-out idea might work.

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Re: Debt-free sustainable currency for the people by the people

It is with a fair amount of foolishness that I reply to this posting, I acknowledge this.

Susmita,

Separating your personal and political views from the topic seems impossible in the context you have set for this discussion. I have read several items on the site, but was unable to find your specific comments related directly to this issue. I did not watch the video, and frankly do not intend to, for no other reason than this: An open dialogue requires the participants to speak in their own terms to a topic or idea that they have a vested interest in. If the intent of this is to create an open forum for folks to participate, then plese site the topic for discussion here in your own terms for all to consume. As such, I can not say with confidence that I understand the problem you are suggesting, and as part of the charter for this pod, which is planning proposed solutions, I've not seen a proposal that illuminates the problem either.

Since the invention of money credit and debt have occured at a macro and micro level throughout history. Economic development globally builds and leverages global labor pools and local economic differences -market forces stabalize these differences - and increases the standard of living for all. All systems are prone to corruption and there are opportunities for exploitation in all of them. 

All of that said, in my experience, you find what you look for.

Money as a function does not even in the best cases provide for an egalitarian system of social harmony. All discussions that talk about rights are discussions of social policy, not economic policy. And while I agree in many ways with Apollia around the many individual misconceptions of money, how it is used, and how it is earned, It is a neccesary evil as long as specialization, resource scarcity, and time limitations are the norm - be wary though, those won't be the primary divers for long.

In the context of international debt ratios and all other madness along that lines - Helping the struggling nations of the world is not done through money- it is done through time and experience. On the hierarchy of needs these countries developmentally are still at the security level or lower, in spiral dynamics these countries are red/tribal, and until interventions are made to stabilize the environments at play, no meaningful changes will occur.

The context of the dialogue as well seems to be US focused, all referenced posts relate to this issue in the context of US history etc. I'd expect that a less USian view would be more appropriate for the global audience that is represented here. I don't want to chill the dialoguge, but in summary help me understand two things, please. First: Is this issue US Centric? Second: Is the issue currency related or wealth distribution related? If it's distribution of wealth, that's a very different line of dialogue that is not currency related. If it's currency related, establishing a new currency ostensibly cannot bring about the social change your original post urges.

Please help me understand what the issues are.

Warm regards,
Wiseman

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Re: Debt-free sustainable currency for the people by the people

Wiseman,

The reason Susmita and others focus so much on the US Dollar is because various world currencies are dependent on its stability. Instead of all currencies having an exchangeable value in gold, or a reserve of gold to back all money in circulation, they now have a reserve of US Dollars (or if they dare to go against the grain: Euros). If the US Dollar goes under, so does the rest of the world.

I can see why you are frustrated with too many links and not enough personalized explanations. That being said, these online sources have really sparked my interest in learning more about monetary systems. What started me off was Wizards of Money, a really fascinating online radio show about the creation of money, its history, etc. http://www.robinupton.com/people/WizardsOfMoney/

Speaking from personal experience, I recently met Bernard Litaer, author of The Future of Money. I wouldn't trust this guy if he hadn't been named Top Currency Trader of 1989, was an economics professor, a central banker, and a monetary advisor to Latin American countries. I had been hearing about him on the net for quite some time, so I was extremely happy to attend his lecture about money. He sat down with me for a talk and we discussed community development and complementary currencies.

What fascinated me was that he does not see modern money as bad, nor does he believe it needs to be replaced. He sees money as a sign of an unbalanced collective unconscious, and sees economics in terms of Yin and Yang.

Yang: masculine, authoritative, centralized, competitive, scarcity, etc.
Yin: feminine, egalitarian, decentralized, cooperative, abundance, etc.

Applied to types of currencies and economics, this means that we are living with a yang-centric currency. Bernard cites the fact that complementary currencies are on the rise globally. These are the yin currencies, and since they are decentralized and created by the people, tthey complement the national currency.

Yang currencies create economic capital, but the great part about yin currencies are that they create social capital, they build communities! Because yin currencies are based on objects that everybody has abundant access to, such as time, these currencies are naturally abundant.

Ok, so this is my rant for now. I intend on ordering Bernard's book because I personally don't see the value in venturing too deep into the internet's negative and one-sided outlook on money (for example, Zeitgeist, the extremely dark movie about the Federal Reserve and other subjects). My education on monetary systems is incomplete, and Bernard actually offers some really cool examples of how to build community, which is why we're on Zaadz in the first place!

Best,
GCon

PS: I know linking is annoying, but check this out: It's a PDF of an essay by Bernard Lietaer on Bali's complementary currency system. The astounding thing about Bali is that people have been predicting that it will become a culturally-damaged casaulty of tourism, but that has yet to happen. This seems to be due to their strong community fabric… in part due to their complementary currency system. http://www.lietaer.com/images/ijse5_postscript.pdf

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Re: Debt-free sustainable currency for the people by the people

You seem to have studied economics, Wiseman. You have summed up the prevailing academic opinion on the nature of economics admirably. Two streams of thought are highlighted: one about money the other the self regulating nature of an economy via the market mechanism.

The essence of this belief about economics is that it is the best possible system (barring, perhaps some periodic adjustments as societies develop).

Taking the money stream, distinguishing between money and credit/debt is wise. But it is essential to bring out details about the nature of modern money.

Money is not what it used to be: metal coins with intrinsic value (gold, silver, copper) or other valuable things. In fact, there have been times, according to my reading, when the copper in coins was worth more than the face value. Then in the last four hundred years money went from paper receipts for metal coins (specie), to paper (fiat) money, to receipts for paper money (cheques), to today's entries in electronic accounts.

The details surrounding money can (but need not) be mind numbingly mystifying. The simplest but still accurate view of money is as a rationing or ticket system:

Compare available and potential wealth (goods and services) as a theatre with a certain seating capacity. If performances regularly took place in front of audiences half filling the theatre, while a queue of patrons were turned away regularly because there were not enough tickets, you could be fully justified in suspecting that the management is incompetent. Yet this is what actually happens when we are told that there is no money to finance this or that necessary or desirable development. And here is a tie-in with the other stream, the market.

It can be hard to believe that there is a strong consensus among many economists that “markets do not fail” in spite overwhelming evidence to the contrary (see some of the discussions on wikipedia).

The truth is that every recession is really a market failure. You have workers unemployed and without income and you have producers unable to clear the stock of good on hand (because the workers don't have enough “tickets” to buy what they and need and want) so they cut back on production and increase the number of unemployed further reducing purchasing power (money/effective demand) in the market by laying off staff. True, recessions do come to an end in due course (the economy adjusts eventually in spite of grossly imperfect competition in the market) but there is no need at all to put up with the booms and busts of the so called “business cycle”.

Now, the thing about modern money is that it has virtually no cost of production. So you could actually print more money “tickets” or create credit money and grant it to the unemployed. They would spend it on things they want which now becomes “affordable”; producers would start producing more and take on more people, and so on. Of course, unemployed people do get paid a pittance but even that comes via the banking system as interest bearing debt to the government. If it is argued that the government should create the needed (credit)money itself, it is dismissed as inflationary. So we have an insane system where creating new money as a social function is deemed bad but if it is created by the banks as a debt (with interest) to the people it is OK.

So can you see, Wiseman, that the idealized self adjusting model of how an economy should function does not actually conform to reality. Of course, what I said above is not a definitive critique of the orthodox economic view and bears more discussion. What I am convinced about is that the theories of how the economy functions are quite far from fitting a real economy. (See, among many other works, The Origin of Economic Ideas by Guy Routh)

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Re: Debt-free sustainable currency for the people by the people

Gcon,

Here here! I like the approach of the yin and yang of the current economic climate. Many have said that the information economy moves us out of the older and more outmoded scarcity mentality and into the abundance mentality. As we approach a threshold where all work is carried out in the mind, and not in physical labor, this shift becomes completely obvious. I have skimmed the PDF and the idea of social capital seems sound. The challenge in today's completely decentralized social system is that there is no such thing a social capital anymore. The Internet has in many ways changed the way social systems evolve in industrialized nations, and thusly social services, and the social capital they generate are unwieldy and awkward to say the least.

A huge part of this in my mind is the rise of consumerism as social role. As we become consumers, the closest thing we get to a social network is guerrilla marketing. Social currencies also aren't scalable, as local resource concentration varies by locale. I hesitate to move further in this channel on this topic, as we have moved quite a bit out of economics and more into social policy, however, I do agree that some form of extra-economic social currency is appropriate, though, an extreme challenge.

The USian comments made in response to Susmita, were largely related to my inability to consume related source materials for the discussion, and thusly trying to be sensitive to the other users in the space that may have an even harder time of it. I'm trying to encourage participation, or if it is a US only dialog, flag it as such and save the time of the readers of other countries from slogging through our socio-economic quagmire.

Thanks for the well thought out post Gcon!

Warmest Regards,
Wiseman

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Re: Debt-free sustainable currency for the people by the people

Hi all, it's finally good to here some different perspectives on the all-mighty money issue and the role of the Federal Reserve and fiat currency in general! Hmmm, that may be as nice as i'm going to be here!lol
To be a good hunter you have to be a good tracker and any honest hunter will admit that they are a predator, and that which they hunt is prey. So why the obsession with tracking every transaction i make? This feels like a predator/prey relationship and i can pretty well assure you that i'm not the predator.
Here's a scenario: it's the year 1850 and your members of the wealthiest families on Earth; there are no Earth destroying nuclear weapons yet and you've just come to fully realize and fully own the fact that indeed there is no god. Certainly no god that would punish wrongdoing.  Now i can't state this strong enough: this has been the ultimate epiphany and revelation; in fact you are now all-most certain that what's happening on this planet is the survival of the fittest and the strong that survive. Yes, how obvious, we can transfer biological natural selection to global economics! This is perfect! This is the Paradise we've always been dreaming of!
Now here's the flaw in your system: the plan you set up in a nuclear free era is simply a recipe for extinction in a nuclear era. Yes, this system is now a certain death-sentence for Humans and most life on this planet! Why? Because it isn't based in reality! Here's the Reality- this is the only planet we know of in the known Kosmos that can sustain life that has creatures that can self-reflect. This Planet has finite resources and ecological tipping points. All i can wonder is: do these families have some secret information and knowledge about some other planet that they can go and live on when this one dies because of their short -sighted myopic vision of Paradise for them? Let me make this clear to these people: i am not a resource to be exploited for profit! Let me say that again! I am not a resource to be exploited for profit! I AM a Human being and there are spiritual traditions all over this planet that teach that that is something to be valued! No, my very very very wealthy brothers that run the banking empires: it's you that has to change if this is the only planet we have. This is your choice and i for one don't find it impossible that you could do the right thing!
I would suggest that the 10 percent principle was not such a bad idea………….

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Debt-free sustainable currency for the people by the people

An example of Debt Free form of Survival is ….this link is visual description of the tree “Moringa”
http://treesforlife.org/project/moringa/default.en.asp

The other quick growing resource which is so Hyped, Confused  and ever popular… is  The origional Hemp tree, Cannabis Sativa | Lativa … .. for ALL uses.


ps…I cannot believe that this, to me, is one of the most important threads there is and I am virtually a 'spectacle' having being the only one who may have contributed or po(d)ndered SINCE 25th august … more than a week …

about  THIS topic …. the Header  says ” Debt-free sustainable currency”

… maybe many on zaadz have already achieved  this state, or born into it. Comfort zone is the Place to rest, PODs shall exite.

alterego says ››› Its all a ∆

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Re: Debt-free sustainable currency for the people by the people

Thank you for pointing out this (possible) lack of interest in one of the most crucial subjects, economics.

It is the economy that straves us or feeds us.

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Re: Debt-free sustainable currency for the people by the people

Quote:
ps…I cannot believe that this, to me, is one of the most important threads there is and I am virtually a 'spectacle' having being the only one who may have contributed or po(d)ndered SINCE 25th august … more than a week …

I'm interested in this thread.  I'm just too oppressed by my financial situation to spend much time on replying to it.  Hopefully this will change.

Apollia

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Re: Debt-free sustainable currency for the people by the people

Sorry folks i had to be out of town for ten days, so couldn't respond as janos asked me to.

No I am not just talking about the US quagmire…the debt-based, usury-based and fractional reserve based monetary system has its origin in Bank of England and bank of Rome.

We the people have essentially inherited a colonnial money paradigm, so capitalism or globalization looks very similar in effect like the exploitation of developing countries and their resources by the developed countries through creation of dominant international currency of trade (first British pound and in this century US dollar and lately Euro).

Fractional reserve system and modern banking (issueing more money 90-95% in excess of reserve 5-10% in deposit) is a leftover of goldsmiths who  functioned as  private bankers/gold  reserve  holders for merchants. This is how industrial revolution and colonnial wars could be financed in 18th-19th century.

Money itself was never clearly defined and economics books still mistakenly define one of money's function as storage of value. Modern fiat money or legal currency is no longer backed by gold (there is not enough gold in US and elsewhere to meet the demand for currency). So I am asking to change the very perception and definition of money as it exists in reality now. Money is actually a pure medium of exchange and not a commodity itself.
I also talk about real and unreal economy. Usury or compounding of interest exponentially is mathematically unsustainable in the long run. Our US governmnent is actually run by the corporate banking cabals led by fed and those who hold enormous wealth. Money has become such a corrupting influence, because it is an insane system the more you think about it. I will tell you it is not easy to make all the connections…but slowly some lights goes on and that is why I want to enagage as many as are interested in this issue. So thanks keith, wiseman, gnc, andrew, appolia and others.

Please read a few paragraphs of my article here in my website (thanks Appolia, i do have two webpages including one on very insightful quotes on money).  Actually with a public treasury and central bank, governments do not have to levy tax, since governments can both spend and lend money, but bankers can only lend only a tiny fraction of the total money. Debt-free money can only be issued by government at the national level or as private community currency at the local level.

 It is perhaps easier for me to answer specific one two line clear questions, time permitting.
I have added some other links in my blog

cheers
mita

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Re: Debt-free sustainable currency for the people by the people