The most advanced monetary ideas have typically grown up in those areas where economic development was critically important--Ben Franklin's Philadelphia, the North Dakota State Bank of the Non-Partisan League, the prairie Saskatchewan Socreds, etc. Their plans differed in minor details but essentially they agreed that money creation was to be a democratic act and that their money was made good by the hard work and cleverness of the people.
Oh, and one other thing--some of these monetary schemes have worked VERY well. Here is an example drawn from the experience in Australia.
The Remarkable Model of the Commonwealth Bank of Australia
Escaping the Sovereign Debt Trap
By ELLEN BROWN
President John Adams is quoted as saying, “There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt.” The major conquests today are on the battlefield of debt, a war that is raging globally. Debt forces individuals into financial slavery to the banks, and it forces governments to relinquish their sovereignty to their creditors, which in the end are also private banks, the originators of all non-cash money today. In Great Britain, where the Bank of England is owned by the government, 97% of the money supply is issued privately by banks as loans. In the U.S., where the central bank is owned by a private consortium of banks, the percentage is even higher. The Federal Reserve issues Federal Reserve Notes (or dollar bills) and lends them to other banks, which then lend them at interest to individuals, businesses, and local and federal governments.
That is true today, but in the past there have been successful models in which the government itself issued the national currency, whether as paper notes or as the credit of the nation. A stellar example of this enlightened approach to money and credit was the Commonwealth Bank of Australia, which operated successfully as a government-owned bank for most of the 20th century. Rather than issuing “sovereign debt” – federal bonds indebting the nation to pay at interest in perpetuity – the government through the Commonwealth Bank issued “sovereign credit,” the credit of the nation advanced to the government and its constituents.
The Bank’s achievements were particularly remarkable considering that for its first eight years, from 1912 to 1920, it did not have the power to issue the national currency, and it operated without startup capital. Sir Denison Miller, Governor of the Bank from its creation in 1912 to 1923, was quoted in the Australian Press on July 7, 1921 as saying, “The whole of the resources of Australia are at the back of this bank, and so strong as this continent is, so strong is the Commonwealth Bank. Whatever the Australian people can intelligently conceive in their minds and will loyally support, that can be done.”
This was not just hype. In a 2001 article titled “How Money Is Created in Australia,” David Kidd wrote of the Bank’s early accomplishments:
“Australia’s own government-established Commonwealth Bank achieved some impressive successes while it was ‘the peoples’ bank’, before being crippled by later government decisions and eventually sold. At a time when private banks were demanding 6% interest for loans, the Commonwealth Bank financed Australia’s first world war effort from 1914 to 1919 with a loan of $700,000,000 at an interest rate of a fraction of 1%, thus saving Australians some $12 million in bank charges. In 1916 it made funds available in London to purchase 15 cargo steamers to support Australia’s growing export trade. Until 1924 the benefits conferred upon the people of Australia by their Bank flowed steadily on. It financed jam and fruit pools to the extent of $3 million, it found $8 million for Australian homes, while to local government bodies, for construction of roads, tramways, harbours, gasworks, electric power plants, etc., it lent $18.72 million. It paid $6.194 million to the Commonwealth Government between December, 1920 and June, 1923 - the profits of its Note Issue Department - while by 1924 it had made on its other business a profit of $9 million, available for redemption of debt. The bank’s independently-minded Governor, Sir Denison Miller, used the bank’s credit power after the First World War to save Australians from the depression conditions being imposed in other countries. . . . By 1931 amalgamations with other banks made the Commonwealth Bank the largest savings institution in Australia, capturing 60% of the nation’s savings.” more
Recession Causing a Banking Awakening in Tough-Hit Midwest
Will establishing citizen-owned state banks be the first step to ending the private Federal Reserve?
Eric Blair
A mass banking awakening seems to be happening throughout America, and the first pragmatic solution appears to be citizen-owned state banks. Since this model has been proven highly successful in North Dakota, many recession-ravaged states are now considering the idea of establishing state-run banks.
Congressman Ron Paul, author of End The Fed, has been trying to educate the public about the private Federal Reserve Bank system for his whole career. And indeed, many terrific books like The Creature from Jekyll Island, and movies like The Money Masters, also have exposed the flaws in allowing private globalist bankers to print the nation's currency.
This hidden knowledge represents the "red pill," and once we awaken to the true criminal nature of our monetary system, there is no disputing the origin of our economic woes.
Consequently, the increased awareness is the reason for the growing movement calling to end the Federal Reserve Bank. However, our Congress, with their paltry 11% approval rating, showed their true colors when they gutted the Audit the Fed provision in the recently-passed financial reform bill which actually gives the Federal Reserve even more power. moreAnd here's what happens when you stand up to the banksters. Sometimes you win and demonstrate that for all its huffing and puffing, institutions like IMF are really paper tigers.
To Viktor go the spoils: how Hungary blazes a trail in Europe
Orban's centre-right party is pioneering an alternative to austerity
Mark Weisbrot
guardian.co.uk, Monday 9 August 2010 16.00 BST
The government of Hungary has taken on a lot of powerful interests in the last couple of months, and so far appears to be winning – despite provoking outrage from everybody who's anybody.
"The IMF should hold the line," shouted the Financial Times in an editorialthe day after Hungary sent the IMF packing in July. "With so many countries in vulnerable positions, it cannot be seen to be a soft touch. Showing a few yellow and red cards is a good way to send a signal to other governments that might be tempted to flirt with indiscipline."
This is the great fear among the defenders of European "pro-cyclical" policies – that is, policies that weaken the economy during a recession or when it is barely growing. Hungary's defiance could conceivably spread to other governments currently being squeezed by the IMF and European authorities.
First, the Hungarian government decided in early July to levy a new tax on banks and other financial companies, which would raise some $855m this year and next. Foreign banks, which made a fortune during Hungary's bubbly growth years prior to the crash in 2007, screamed and lobbied, but – despite having the IMF in their corner– did not prevail. more
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