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Free money (drugs sold separately)

by on October 24, 2013
vollgeld-initiative.ch

vollgeld-initiative.ch

Great news: Some people in Switzerland are working on an initiative to change the way money is created.

An ‘initiative’ is a tool of direct democracy.
You might want to wiki these two terms:
initiative
and
direct democracy
Still think you live in a democracy?*

Money is created today when a commercial bank grants a loan, mortgage or consumer credit.** The money is destroyed upon repayment. Our cash mingles with this chiefly electronic money, but no debt -> no cash.

The title of the Swiss initiative mentions a one-off creation of 300bn francs. This money would be introduced gradually into the system, as loans are repaid.***
Without this procedure, Switzerland would be making a huge gift to the banks. We’d be PURCHASING the money supply, rather than REPLACING it.

It may take some time for commercial banks to adjust to the new situation. After all, it’s a shock when one can no longer just create money at the touch of a button! A temporary emergency fund should help make the transition.

For the rest of us, most things will stay the same. In daily life, that is. On a broader scope, it’s bye-bye too-big-to-fail. Finally.

“If not by debt, how else do we bring money into circulation?” – Good question, thank you, Tom. More good news: we’d simply GIVE OURSELVES SOME!

That’s right folks: free money!!

Naturally, this would have to be done in a controlled fashion, to avoid hyperinflation, but the Swiss are a disciplined bunch. This may surprise you now, but Switzerland has traditionally always been a poor country. It’s why Swiss breakfast consists of jam and bread – a cheap source of calories. Mercenaries and the banking brought inordinate wealth, but frugal attitudes remain. These are people who voted against an extra week’s holiday!

The idea of simply GIVING money to the people fits nicely with another Swiss initiative, ‘basic income guarantee’, that recently achieved the necessary 100,000 signatures and will be put to popular vote at a future date.

More free money …sounds crazy, I know!

But isn’t it more crazy for a sovereign state to go into debt in the first place?
Isn’t that what ‘sovereign’ means: “fully independent and determining its own affairs … control without outside interference” (OED) ?!?!?!

Why even have national debt?
Whom do we go into debt with?
Each other?
Every country is in debt – to whom?!!

There is no reason a sovereign state should go into debt with private corporations.
Unless you are one.

PEACE

For more reading on Swiss initiatives, see our article here on fat-cat laws.
On corporations here and here.
The laws of nature can’t be changed, our economic system can!

* Correct me if I’m wrong: In US-terminology, the Swiss ‘initiative’ would be a ‘national ballot initiative’.

** Or when it creates money to purchase an asset. Let’s not get nit-picky, ok?

*** It’s worth noting that the German for “to repay a loan” is “tilgen”. “To repay” or “zurück zahlen”, implies that the money still exists. It is, however, destroyed.
Think about this, please, next time you find yourself wondering why the loans that constitute our respective national debts are seldom truly repaid, only replaced.
This is the single main reason why debt just keeps mounting, and why one really needs to squeeze HARD (or be an IRON Lady, hint, hint) in order to put a serious dent in the debt. This a shambles which flies in a face of democracy. It is justified with statements such as “yes, but new money is created, too.” However, it distorts free markets, e.g. into housing bubbles, because a “bank that is focused on reliable and high profits will usually prefer to loan against collateral than against future cash flows.” (Where does money come from? – nef, 2011, p. 108) Translation: It’s easier to seize a home than it is to read a business plan. Nota bene: it’s not the “reliable and high profits” that are a problem – just the small question of Who creates money and what for. The nef book goes on to ask: “If banks have been awarded the public privilege to create the money supply (…), should they not also be given certain obligations to ensure that this enormous power is used mainly for activities that contribute to the common good?” (ibid. p. 117) That would mean heaps of regulation – unnecessary if you take a step back and simply change HOW MONEY IS CREATED.

=====

For terminology buffs: the system described here is known in German as ‘Vollgeld’ – a term coined by Prof. Dr. Joseph Huber
Vollgeld = “Vollgültiges gesetzliches Zahlungsmittel” (Huber). Unbare Geldguthaben sind nicht mehr Bargeldersatz, sondern vollgültige, vollwertige gesetzliche Zahlungsmittel wie Münzen und Zentralbanknoten.
English: ‘Plain Money‘ or ‘Sovereign Money‘. Electronic money is no longer a surrogate for cash, but emancipated legal tender.

In Switzerland, it is advocated by an organisation called MoMo (MOnetary MOdernisation), the site for the initiative is http://www.vollgeld-initiative.ch (German, French, Italian). A similar organisation in Germany is monetative. This choice of name indicates that the money supply must be determined by a body independent of that which allocates government spending (eliminates danger of uncontrolled growth, hyperinflation). The power to determine the money supply would reside with a fourth branch of government alongside executive, legislative and judiciary: the MONETARY!
The appropriate organisation in England is called Positive Money, probably because our current debt-based money system is something negative.
Also, there’s Sensible Money (Ireland).
For more organisations and links, see internationalmoneyreform.org

For hg2g fans: whenever you read “hyperinflation”, think of Golgafrincham B-Ark adopting leaves as currency. Then read this, thanks.

“Banks need Boundaries!” grew out of “Banken in die Schranken!”, a group of European money-reform activists, based in the German-speaking area. Its goals center on money creation, but extend slightly further, see our petition at www.change.org/en-GB/petitions/banks-need-boundaries

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One Comment
  1. When I think of BASIC INCOME GUARANTEE, I am also reminded of something in this video

    “how we shop, or like not to shop – those are all votes”

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