Russian Finance Minister Anton Siluanov wants to aid Western neoliberals in the destruction of Russia's welfare state to bring Russia to heel under the US, which welfare state wasn't strong enough in the minimum-wage rate and union aspects already. You may read about this Austrian School of Economics finance minister's approach here: Russia’s Siluanov Freed by Ruble Slump to Slim Welfare State - Bloomberg Business.
I don't want to drag out this blog post. Let me make this very simple. Vladimir Putin needs to come to understand that the problem with Russia right now isn't low oil prices but issuing bonds to issue currency. Issuing bonds to issue currency is completely unnecessary and is highly counter-productive.
Russia could create bond-free, interest-free, debt-free rubles enough to pay for any real productivity Russia would want. If the increase in rubles were matched exactly to the productivity gains and those gains were permanent, no price inflation would result.
The only reason Vladimir Putin wouldn't issue bond-free rubles is because he doesn't know about the possibility or he is secretly a neoliberal or because there are too many neoliberals in high places in the Russian government to the point where Vladimir Putin fears he could not oust them without being overthrown himself.
Vladimir Putin has a history of coming down on the side of the welfare state versus the capitalist class in the Russian mixed economy; therefore, we don't believe that he is a secret neoliberal. It is that he either doesn't understand the fundamentals of the pariah banking industry and class or he is surrounded by greedy, self-interested rent seekers (crony capitalists for the purposes of this post) and laissez-faire capitalists.
Vladimir Putin, the private bankers are your enemies. The usurers will turn Russia into a vassal state of the United States Empire.
Mr. Putin, you need to have people in Russia who are loyal to the welfare state research what is happening right now in the Canadian legal case of COMER v. The Bank of Canada.
Here's a video on the subject. It lays out somewhat what's at issue in the legal case but goes on so that the viewer will see the confusion that Austrian economics adds to the issue.
You see there the avoidance of the concept of decentralized democracy, the same problem addressed below concerning Ludwig Von Mises. There is an alternative to nothing but central planning in a welfare state, a social-democratic state (mixed economy), a democratic-socialist state, communism, or whatever. More on that below.
Here's a recent explanation of the case:
There is a very interesting legal case that is playing out in Canada at the moment. William Krehm, Anne Emmett, and Comer (The Committee for Monetary and Economic Reform: http://www.comer.org/) filed a lawsuit on December 12th, 2011, in Federal Court to try to force a restoration of the Bank of Canada to its mandated purposes. In essence, they want the Bank of Canada to provide interest-free loans to the federal, provincial, and municipal governments, as provided for in the Bank of Canada Act. This money would be used to finance public expenditures whenever there is a budgetary deficit. Apparently, the federal government used to borrow interest-free (to at least some extent) from the Bank of Canada up until 1974. At present, governments borrow all of the necessary money (apart from any bonds they may sell to the public) from private banks at the going rate of interest. Canadians are economically burdened with the resultant debt-servicing charges because the Bank of Canada does not make use of its prerogatives in the interests of the Canadian public. The case is being prosecuted by Rocco Galati, who is widely considered to be Canada's top constitutional lawyer.
Canadian constitutional lawyer, Rocco Galati, on behalf of Canadians William Krehm, and Ann Emmett, and COMER (Committee for Monetary and Economic Reform) on December 12th, 2011 filed an action in Federal Court, to restore the use of the Bank of Canada to its original purpose, by exercising its public statutory duty and responsibility. That purpose includes making interest free loans to municipal/provincial/federal governments for "human capital" expenditures (education, health, other social services) and /or infrastructure expenditures.
There was a time in America (colonies) when currency was free of the bond encumbrance. Things were so good for the Americans that the British inquired of Benjamin Franklin, called one of America's "Founding fathers," how it was that America was prospering so much, growing, etc. Benjamin Franklin informed them that it was because the currency was being issued without the encumbrance of having to pay interest on it.
A false refutation to the need to get rid of national bonds in the US is that the Federal Reserve returns it's gains to the general revenue (US Treasury) only withholding a small percentage to cover operating expenses. However, the Fed doesn't hold all the US bonds that are issued. The national debt is large. The percentage of taxes going to pay interest is significant. As important is that money creation is needlessly constrained in the economy due to it being credit-based via the commercial-banking system resulting in a truly stupid stifling of growth.
A so-called modern argument against issuing money without bonds is that too much money will be issued. That need not be the case. The supply of money can match productivity needs and results and sustainable economic growth.
All transactions via what would be the sole legal currency (the ruble), which would be cyber currency, could be, and should be, captured by the only bank that should exist in Russia, which should be the Public Central Bank. All expenditures should be decided not by bankers extending credit and making interest-bearing loans but instead by the democratic process (as pure as would be practical to make it). Understand the term "pure democracy" versus "representational democracy."
Local projects would be decided democratically at the local level. Such decisions would be democratically balanced across the entire Federation.
If a funded project did not result in anticipated increases in productivity, the Public Central Bank could drain the money supply in real time across the whole economy so that no inflation would result and without anyone suffering.
This system I've briefly described here completely answers and refutes Austrian School economist Ludwig Von Mises concerning his mistaken idea that his version of price signals (via voting with rubles in this case) is necessary for a market economy. Each person's vote is the signal. It is not different than each person's ruble in the anarcho-capitalist system (which system would be an utter disaster) with the exception that each person's vote would carry the same weight rather than the rich having a greater say by virtue of having more money to spend and spending it (including to buy finance ministers whether directly or indirectly) .
You want good government, Mr. Putin, and not no government. You want a strong welfare state. You want a strong democracy. You can't have either with what Russian Finance Minister Anton Siluanov is peddling on behalf of anti-welfare state and anti-democracy forces headed up by those rightly called banksters.
For others, here are President Putin's recent concerns: Meeting on lending to real sector enterprises. My suggestions above would instantly take care of all of that.
UPDATE: Here's a link to an interesting article by William Engdahl: "Russia Debates Unorthodox Orthodox Financial Alternative." From that, if correct, it would appear that the Russian Orthodox Church understands Christian economics. Historically, Christianity was strongly opposed to usury (interest). I hope Vladimir Putin is getting the right ideas.
Let me add that "Islamic economics" is not Christian. True Christian economics is non-profit in the capitalists sense of the term "profit."
For what shall it profit a man, if he shall gain the whole world, and lose his own soul? (Mark 8:36) There's plenty more where that came from.
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