The pair have coined a new word they base on an ancient Greek term for 'usurer' or 'moneylender' (danista) to denote the entire system we suffer under today; "Danistacracy" (Danistakratie in German). I imagine you've already heard of alternative names for our compound interest system, such as Corporatocracy or Kleptocracy, which are instructive enough, but I think this one nails it, since the dynamic that really does the damage is compound interest. Far be it from me to assert this or that term as the best, and Danistacracy is certainly not catchy, but in its meaning the word is accurate and descriptive.
Just as with Charles Eisenstein and Franz Hoermann (and others), the pair are at pains to point out that it's not individual, evil people who are in the way of a Better World, but a system which organizes society along particular lines, with a particular flow and dynamic. To quote Charles Eisenstein once again:
This movement isn’t about the 99% defeating or toppling the 1%. You know the next chapter of that story, which is that the 99% create a new 1%. That’s not what it’s about. What we want to create is the more beautiful world our hearts tell us is possible.We can't stay as we are, lop off a few heads, and expect anything other than a 'hello new boss, just like the old boss' event. Until we build from out of our own wisdom and ingenuity a system which transcends and improves on this functionally rapacious Danistacracy we are glued to its inevitable collapse. We have to work on ourselves, do that work, before the systemic and broader social solutions can flower from those efforts. Happily (or frustratingly, depending on your point of view) work on self and work on better systems is more or less the same thing. "The more beautiful world our hearts tell us is possible" can only grow out of our intent to build it, and the know-how we learn while trying.
And now on to some graphics:
Popp and Albrecht use the classic pyramid shape to denote the hierarchical and upward flow of wealth to the 'controllers' of the compound interest system. The highest level are the owners and controllers of money themselves, the Danistacracy, who have placed between themselves and the lowest level the dual fogs of "Mainstream media" and "Political theatre", which together represent a kind of virtual reality the producers and doers are surrounded by at the logical bottom.
By the way, I have tweaked their graphic to make it appear more seamless than the original (theirs deploys distinct colours for each segment, and separate blocks to build the pyramid shape), preferring to try to reflect the general oneness of things. Of course there are lines of separation, but I don't believe they're absolute or impenetrable.
Of note is that Media sits above the "Political theatre" segment which, in the Popp/Albrecht presentation, is further subdivided into 'corrupt' and 'stupid' politicians; those who know the game is crooked but play it to line their own pockets, and those blindly loyal to this ideology or that. Either way, the media/politics region is, in its broad effect, a show, a self-sustaining virtual reality to divert attention from what the Matrix film so poetically called "The Real". This virtual reality hides the system's deepest dynamic, which is ongoing extortion of the producers and doers, an insatiable rapacity (how can usury be satisfied?) creating "The Desert of The Real", the destruction of the planet we are not permitted to see. Some figures to that end:
Professor Senf mentions the marriage of a poor boy to a rich girl. The figures are startling: Poor Boy earned 4,600 DM monthly, before tax, Rich Girl earned from interest over 650,000 DM daily (quoted from Bild, 27/7/1990). [snip] I wonder if Ms Quandt and Mr Klatten are still married, and if happily so.
Albrecht informs his audience that a billionaire with a normal investment spread in various stocks and bonds would earn 50 one-family homes every year simply as a 'reward' for possessing that much money. (And no, money cannot 'work for you.' While the money might have been 'earned,' the interest on it most certainly is not.) Whether your earnings on interest are 650,000 DM a day or the money equivalent of 50 houses a year, that kind of money-growth has to be backed by something. In other words, there have to be millions upon millions of not-so-rich producers and doers creating the goods and services that give that 'earned' interest its value. How could it be otherwise? If all of us 'earned' from interest that kind of income, what would we do with it? It would of course be hyper-inflationary. In brief, the Danistacracy system requires, by design, extreme rich-poor divides. And they are stubborn divides, precisely because they are systemically generated and required.
Another factoid or 'data point' Albrecht brings to our attention, is that having some money in the bank, say, 300,000 euros, does not mean you are a net beneficiary of the usury system. The 6,000 or so you might earn a year (gross) does not compensate for the hidden cost of interest repayments passed on by manufacturers, shippers and retailers everywhere. Prices are up to twice as high as they would be in an interest-free money system, according to Abrecht. That is, even if you are a net saver, inflation corrodes your wealth 'invisibly'—as the money supply grows faster than goods and services can—, while the simple passing on of debt-costs to customers, concealed in prices, 'steals' wealth too, hands it over to the Danistacracy. Albrecht tells us it is only those with 1,000,000 or more in relatively liquid assets who actually net-benefit; the famous, symbolic 1%. Again, and very importantly, this does not make them the enemy. As Gandhi said,"Love the sinner, hate the sin."
Also prominent in Albrecht's talk is the exponential function. He cites the German Green Party's demand for 2.8% growth, but points out that such would mean Germany producing twice as much as 25 years from now, four times as much 50 years from now, eight times as much 100 years from now, and so on. Why should we want to do this? Why is economic growth Good Beyond Question? Why aren't we discussing the obvious absurdity of such proposals? Because the usury system—which its beneficiaries will protect at all costs—must be left behind if we are to leave the Perpetual Growth Grave Train behind (yes, I do mean "Grave"!)
So, what to do? Here is their suggested 'solution' in graphic form:
(I have translated "Soziales Bodenrecht" as "The Commons", even though "Allmende" is the proper German word for "commons." Any help from my German readership would be appreciated!)
Econosophy's slogan is, "Demote money, promote wealth", which I see as a description of a direction, not of a goal. The point is of course that the journey is the destination, the means are the ends. There can be no end point we reach where we say, with relief, "Finished! At last we can stop working!" Change is the only constant. However, humans still need 'where we are now and where we're headed' linear-thinking crutches, so graphic representations serve us still, and help focus the mind on the broader points. They are:
- A money which rewards investment in community, which captures the Piraha saying, "I store my meat in the belly of my brother." Hoarding 'wealth' to protect Me And Mine is actually, seen over the long term, a fear-based addiction which exacerbates itself—self-fulfilling prophecy—while slowly destroying community. Investing in the health of the networks which enable our healthy living makes far more sense. Negative interest money is a way of promoting such a wisdom. It demotes money and promotes wealth.
- A guaranteed income, which decouples money and work, ends the notion that we must 'earn' a living. If we each receive a share of those fruits generated by the collective ingenuity of humanity and nature, we are notionally freed by these gifts to carry on contributing to that process which sustains us. It demotes money and promotes wealth.
- Expanding the commons encourages us to recognize that property is a harmful illusion, which can only engender more fear and greed. To promote true wealth, which can only be the health of the broader system—including environment and community—we must be invested in it, 'know' we are components of it, that as we treat it, so we treat ourselves. The commons is the correct domain for encouraging this deep sharing.
- A free press is part of the open and transparent dissemination of information, which I feel would be an absolute inevitability should we manage to construct a social system based on the other three themes thus far discussed. I would have had "Open education system" (or similar) in its place, but hey, I don't agree with anyone on everything, and a free press is certainly something humanity could use right now.
First, they will draw up the details for a truly publicly owned central bank with a monopoly on money creation—no more commercial bank money creation. They think of this as a money commons in a left-wing way; a money creation process owned by the state. Now, I'm not a 100% fan of this idea, because it concentrates too much power in one organization, but would support it with reservations; negative interest money, an expanding commons and guaranteed income are part of the plan. I also have not heard Popp and Albrecht state that no other monies (e.g., Ithaca Hours) would be permitted, so my reservations are minor. At least Popp and Albrecht aren't proposing this and only this.
Second, national debts are to be forgiven. Or, they would arrange a pro-actively organized sovereign default. The details here involve buying back bonds from e.g. pension institutions and 'ordinary' citizens who have invested in government debt, by exchanging them for what Albrecht refers to as Bankguthaben. This is, to my English ears, a strange choice of words, since Guthaben can be variously translated as 'credit,' 'assets,' 'balance,' 'deposit,' and even 'money on account.' So in the absence of information to the contrary, I'm going to assume they mean negative interest money, which is what Eisenstein proposes; the targeted buying off of existing government debt with non-debt, negative interest money. In that all pensioners would be the recipients of a guaranteed income, this is nowhere near as draconian as it might seem. As for inflation; yes, says Albrecht, this act would be a one-time inflationary pressure, but considering the current system is suicidally inflationary by design, a short burst of inflation followed by a balancing out is the wiser choice, particularly when the alternative is driving the usury system ever onwards, until there's nothing left but blackened toast to peck at and squabble over.
(A brief aside on 'all money is debt:' When I say non-debt money, I mean money the government prints into existence, not borrows into existence. I believe the distinction is an important one.)
Albrecht then asks, somewhat rhetorically, if the solution is so obvious, how come representative democracy isn't delivering us from the insanity of the current money system? He supposes, for the sake of pursuing the 'legal' path, that the parties might be Too Busy dealing with the humdrum to put together the necessary laws for enacting such a plan. Popp's and Albrecht's institute are, therefore, with the help of constitutional and other lawyers, preparing precisely such a body of law, which they will present to the German government shortly. At least then it cannot be said this 'legal' avenue was not trod.
Should it transpire that the Popp/Albrecht Statute (or whatever such proposals are called) is not greeted with euphoria, they plan, as a necessary second 'legal' step, to write a new constitution for Germany. Such is granted by existing law in the event that citizens feel the government is not acting in their best interests. Again, the likelihood such a new constitution would usher in the sustainable system proposed is vanishingly small, so where they expect to be most active, and where they are investing their real energies, is in building the new system from scratch; secession, more or less.
The virtual reality created by the Mainstream media and Political theatre is very effective. We cannot expect to attract anything close to a majority with such ideas. Indeed, Popp reckons 5% of the population a tipping-point amount. In Germany that would be about 4 million souls. That's a whole bag of bananas right there, enough to include a rich vein of skills such as farming, plumbing, housebuilding, car maintenance, energy production (renewables), doctors, hospitals, IT expertise, lawyers, and so on. The point is to network, pool resources, build, learn, prepare. The act of 5% of the population leaving the existing system behind would collapse it, but there would then be something new to move over to, the requisite experience to take the strain, so to speak. Of course, there are no guarantees, but I don't see Doing Nothing as a reasonable option, and agree with Popp and Albrecht that we are in fact morally obliged to rebel. The system is that decadent and criminal, and obviously so.
I want to close with a quote from Europe's new banking overlord, Mario Draghi (thanks to Charles Wheeler for this):
What is clear then is that any fiscal integration will require fiscal discipline aka austerity and this in turn is the prerequisite for any imminent ECB liquidity and for Eurobonds over the medium-term. Yes, budget cuts will deepen the recessions in the periphery. But, there is no way around it; politically, no solution in Europe will unlock the sovereign debt crisis without fiscal consolidation. All of the political leaders are aware that this is so."All of the political leaders are aware this is so." Money is God. Obey, or perish. Price is the One True emissary of value. If a thing does not make economic sense (money-sense), it does not make sense. If it does not make money-profit, if it does not generate Economic Growth, it is not worth considering.
This is the binary thinking we are up against. We are morally obliged to rebel.