I'm engaged in an interesting discussion over on Edward Harrison's "Credit Writedowns" website: "Why didn't the Fed release a statement on the dollar liquidity bailout? | Credit Writedowns." That link points to my comment, but scroll on up to the top and read Ed's post and then all of the comments that follow.
Here's my most recent comment as of the original posting date/time of this post on the RLCC site:
You are correct, Marc, about Jubilee. We need something akin to it, but we also need a solution so Jubilee isn't needed again.
QE is necessary but only because structural integrity was lessened by those who knew that such de-regulation would position them so they could simply yell for help (as Henry Paulson did; he also physically got on his knees) and the flood gates of money flowing their way would be opened, which is exactly what happened.
Do QE right now, but demand as a central component that the system be taken back to the drawing board with the order that structural integrity be designed back in to the extent that the so-called business cycle is forever preempted. Remove all possibility that defaults (whether hard, soft, direct, or indirect) will ever be borne by the poor.
This primarily requires the de-linking of sovereign money from bonds. Never issue sovereign money as debt. Who is the sovereign, public or private? Right now, in terms of money issuance, it's private. That's an evil. The issuing governors are not serving with the informed consent of the whole people (the public). The money is not the people's by way of their government or state.
The talk of Euro Bonds is exactly the wrong direction in this regard. The euro should be taken back to that proverbial drawing board and brought back out as a debt-free medium of exchange.
Even in the short run, the issuance of euros (and US dollars) should not be controlled by what is called finance capitalism but moved first to industrial (productive) capitalism with the view of ultimately and as quickly as possible, raising all boats with an ever-rising tide: no more "business cycle" for the crafty superrich to create at their demand when they have themselves exactly pre-positioned to gain the spoils.
United States Notes is the way to begin this in the US. Pegging the supply to real productivity is the way to avoid both monetary and price inflation and deflation. A constitutional amendment is required to handle the metals aspect that is now required by the Constitution.
All of this is absolutely doable. Humanity has the ability to handle the supply and measurements of the flow of funds and velocity, etc., in nearly real-time.
Now, the Austrian School will raise the issue of picking winners and losers, but a dollar or a euro spent is a vote and a vote via a ballot is also. The only difference is that the votes of the poor would count as much as the votes of the superrich, which currently is not the case.
The superrich do not have a larger say because they are more deserving by virtue of their having amassed money and material. Thinking that they do is to hold with the view that ethics is irrelevant, Social Darwinism is all that matters, and the best taker is evolutionarily destined to be the last being. Look at the problem with that outcome. The greatest monopolist has eaten everything and is left completely alone with nothing left to devour.
You can see Marc's reply above mine here (also duplicated below).
Yes, if I were to be suggesting that everyone who is superrich is likeminded about all of this, then that would be a mistake. Look at the difference between Buffet and the Koch brothers, for instance. I'm not for a moment suggesting that Warren Buffet is a paragon of virtue, but I do believe he really does think it is unfair that his secretary pays a higher percentage of her income on taxes than he does. I'm using the term superrich in very general terms. Even all bankers are not alike. The difference between the bankers running the Bank of North Dakota versus certain banks in Liechtenstein is nearly as night versus day.
I do believe that the greatest hidden power is concentrated in the hands of banking dynasties. So, I agree with you. However, I deliberately used the term superrich versus banker or bankster because so much of the banking system is commingled with the giant corporations and their masters. Would it be that the corporate masters would side against the banks. The equity markets are supposed to allow for that, but little happens.
I like much post-Keynesian material I've seen. It seems I came to most of my similar conclusions independently. They were original to me, but I wasn't surprised to see that others had often thought the same thoughts. I'm also not surprised that it doesn't have a huge following. It requires a great deal more in the way of abstract reasoning than the other "schools."
You stated that "the interest is usury in bad times." Of course, that's the neo-definition. In my book the interest is always usury, and usury is always an unnecessary and even bad thing.
Yes, QE does create many of the negative conditions; and for the Keynesians, they just want to time things to head off overheating. I understand that; but again, it's not only unnecessary, it's bad. I'm not in the least advocating the laissez-faire approach though. I understand the Austrian concept of letting the weak fail so the stronger, better run and what have you, are the ones who remain standing offering superior goods and services.
However, I really don't want money being the only vote or any vote at all for that matter. I'm a firm believer in sharing and democracy in the workplace and such. It's called socialism and communism, but it can also be viewed as pushing capitalism down to the most widely dispersed level possible. I've never seen it stated that way before, but I believe it's a valid way of viewing it. Rather than a few "owners," there's everyone. Then they decide together via equal says, and the best idea gets the nod – at least the idea that was put over the best with everyone having an equal say (discussions) going in and then decision (vote). To me, that would prevent a great deal of the corruption we see.
As for the "doable" issue, I can certainly see how you would interpret it the way you did. To clarify, let me say that I'm not suggesting that everything is in place. I'm saying that we have the know-how and technology. We could put it in place fairly quickly and easily if we could get beyond the blockade that is the bankster class.
Yes, as you said in so many words, transactions would have to be transparent. I am aware of the arguments for the original uses of derivatives. I must say though that that system has run amok (and on purpose), as I mentioned in the comments above.
Regardless though, if the money were United States Notes pegged to real and democratically decided projects (productive projects to bring forth what the whole people need and want), then what would be the need for swaps and the like? They'd be rendered moot.
The system we have, the neoliberal system, built on banking is retarding the development of humanity to such a degree that it boggles my mind. It is unbelievably shortsighted. Even the rich would be vastly better off being even or level with all others in a world unleashed from the constraints of private banking notes, lending, and usury.
By the way, United States Notes don't require taxes. They can also be used to pay off the national debt. Let's weed out the fraudsters first though.
If this is a duplicate comment, I apologize. It didn't go through the first time.
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