Wednesday, October 14, 2009

Interesting how unreal interest is

Interest on money is a conjuring trick, a presentational slight of hand to promote a service that seems to benefit the many, but in fact benefits predominantly the money men.

Question: If all bank customers on the planet only had savings accounts earning interest, where would the money come from to pay that interest?

Money can’t grow. It’s not an organic biological entity capable of imbibing other organic matter and transmuting it into growth. Interest rates applied to money are mechanisms for accruing more money to the institution that offers the service of taking care of money; banks. Debt represents earnings for the banks. If what banks owed depositors were more than they earned via their loans, banks would go bust. Interest is an ongoing, changeable fee for services rendered, comparable to an architect constantly changing his hourly rate while working for you.

The complex mechanisms of money movements plus interest rates are a process of money transfer to the banks over time, via debt. It is not some great conspiracy, but rather a predictable and natural consequence of a monetary system in which money is the best lever for accruing wealth and power. Therefore, logically, those who control money establish mechanisms which siphon as much of it as possible to them – that this happens at the cost of others is irrelevant. Preventing this unhealthy imbalance from causing systemic crises is a never-ending and fitful struggle conducted over centuries by us malleable humans with short-memories and immediate survival needs. The battle – perhaps uncontroversially described as a battle for fairness – cannot be “won” while money decides what makes societal sense, and what doesn’t. Where there is money, money can only be too powerful. Money is a jealous god.

Some believe money can be redesigned. Ideal would be a money created or destroyed in perfect harmony with the dynamically changing amount of labour-based value in an economy. Money is a representation of the value generated by the labour expended in bringing some good or service to market. Could there be a money designed which directly and "ungreedily" represented this value? A money which discourages hoarding, cannot itself be a commodity, deployed in a socioeconomic system designed to protect those incapable of adding value to the economy? An attractive idea, but I doubt such a money can exist. If it could, I would be for it. I think money is logically bound to scarcity, which encourages hoarding and corruption, transforming it, over time, to a destructive, not creative force. What do you think?

For now, the tedious fiddling with ever newer and complexer laws, which may or may not bring temporary relief, is simply playing the game on the assumption that only money makes culture go around. A lasting solution needs to properly and carefully question this assumption. The Venus Project have done this, and propose the testing of a resource-based economy. Fundamental is the question of whether or not we have now arrived technologically at a point where material concerns such as nutrition, shelter, energy, education, health and transport are deliverable to all in abundance. Abundance is anathema to money, as money is anathema to fairness (it inspires corruption).

Please consider carefully and openly what transitioning to a resource-based economy would mean and how it might be handled. I believe it represents our best hope of building a path to a future in which no one need suffer the ravages of poverty and war. That this sounds Utopian is a damning indictment of the current system, not the proposal put forward by The Venus Project. Is our amazing species really incapable of solving, everywhere and for everyone, material problems such as energy, food and shelter?

Surely not.

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