The Monetary Creation Stakes
Hello, I am glad to see so many of you.
I have been working for 6 years on 2 unusual but fundamental subjects
that are discussed nowhere in the media, though.
I came to that step by step.
Like many of us I was politically inactive before 2005
and I woke up to this during the debates about
the european union constitution.
Reading this text I got scared because this text was incompatible
with our national constitution and it was clearly made to overcome it.
I knew that this treaty was a bad constitution because
it left people helpless against abuses of power.
I saw it and denounced it.
I was lucky to be heard.
This kind of luck changes a man because
my point spread widely and quickly on internet.
People started to discuss and criticize it,
I spent nights to answer them,
I had to sharpen my arguments and
all this helped me to greatly improve on the subject.
Finally...
I am trying to summarize briefly what brought me to this in 2005.
After 2 months I got nearly 800,000 visits on my website,
about 40,000 a day during the last month.
It is quite something for a normal person.
I had never been in politics before and
My audience was never larger than a classroom before that.
People sent me like 400 emails a day, some enthusiastic, some moving.
But I got some incisive emails too,
calling me a fraud or an idiot,
some very nasty emails.
I spent nights to answer them first but there were too many.
Therefore I started to answer people on my web site.
I answered to these people once for all because
everybody told me almost the same thing.
So I published my answers to these emails on my web site.
And you pay a particular attention to your answers when you know
that you will be read by 40,000 people during the next 24 hours,
some of them seeking the first slightest mistake.
It urges you on to read much, to sharpen your arguments,
you seek help from any clever source around you.
Therefore, in my first text, I begged for people's participation.
It was incredible for me to have an opinion
that differed so much compared to what I heard on the radio.
I wrote: "please, tell me where I am wrong.
I must be wrong, I am no match for leading experts
like Giscard d'Estaing or Delors that built European Union.
In my text I wrote: "I might be wrong somewhere.
So please just tell me and I will correct my mistakes.
But as far as I know, this is my current position".
And...
it worked. People helped me and the final text is still
available on internet, it is called "Une Mauvaise Constitution".
And it is still very relevant since this very constitution
was finally adopted. You know that this so called
"new" constitution is a simple compilation of the older treaty.
The original treaty was simply differently rewritten.
With minor changes, but basically the same rules applied.
You know that the constitution voted in 2008 by the parliament
was rejected by referendum in the first place.
This is for me an authentic treason, a Coup d'Etat.
This is deeply legal for having been voted by the parliament
but this is exactly what I call an abuse of power.
This is precisely what I want to discuss today.
This is the heart of my work, what I am working hard for.
I...
I seek efficient solutions against abuses of power.
any case of abuses of power: abuses from socialists,
abuses from capitalists, abuses from people...
I intend to organize the society in a way that abuses are not possible.
And in general, abuses of power are done by rich people.
Not exclusively, people also might commit abuses.
For example a popular gathering might become
a furious mob and might commit injustices and abuses.
But it is most frequently done by rich people.
We will see when and how.
So I want to resist abuses of power.
For that I intend to identify the cause of the causes of abuses.
I mean that problems have more than one source
and
I observe that people I argue with, politicians from any party...
usually consider a unique aspect of power abuse, and fight it separately.
For example, one will take care of and only of ecology.
He will focus on that, he will spend all his energy on that
and he will drop other topics
He will not try to discover why ecology is no political concern,
why people who might want to fight for ecology have no political power
and how comes that people who destroy environment have political power...
both political and economical power.
Usually no one tries to understand that but when I seek for
the origin that enables the ecological destruction of the planet
I find a political cause...
and an economical cause.
I observe that large scale destructions are done by rich people
who rule politically by means of election.
Ecology is just an example, there are many topics like that.
For example, feminism... Currently, left people are focused on
fighting for feminism, fighting against racism
and have many similar positions I may agree with.
But all this is not the main problem for me.
The multiplicity of social strugles is dividing us...
because people fight consequences instead of fighting causes.
As if...
As if we had water-flood.
There is a faucet fully turned on, and there is a water-flood.
Everyone is mopping up and no one is considering turning off the faucet
As another example, imagine our social activity flowing like a river.
This river is extremely polluted by a pink foam representing unemployment.
On one side of the river, people are fighting against unemployment.
But these people never try to investigate upstream,
never far enough to discover the source of the problem.
And on the other side, people with another concern are doing their best
to repair ecologic damages, to urge people to respect the environment,
but once again, without looking for the original problem.
I am interested in all these topics and
when I try to identify the deepest cause of all these problems,
I always get the same answer. We always find...
rich people...
with power...
because they bought election.
They paid for the winner's campaign.
You always have manufacturers and bankers, namely rich people.
We will see that banks arose out of storekeepers.
So basically banks and manufacturers are alike,
it is the wealth accumulation that enables political corruption.
So...
My works are focused on 2 big topics:
the monetary creation, this will be the first part of my talk.
This is a wide topic and I could spend a whole day on that
so I will try to be as synthetic as possible.
I may come back to that later and go into the subject in greater depth
during a discussion, according to your wishes.
In the second part of my talk, we will discuss the joined political aspect:
I think that we won't take money control back from bankers without sortition.
For me, election is the problem. It is desperately considered as a sacred cow.
I can understand that multinational company
support the election principle. And they do it.
But there is something strange about left humanist people
who yearn for a peaceful society where arms dealers do not decide.
Oddly enough, they defend the election that enables rich people to buy power.
This will be the second topic of my talk.
I will show you the athenian democracy.
It is a great system that raises objections.
I have been working for a long time on that system
so I am able to refute all these objections so far.
But maybe you will ask me new questions.
This is exactly what I expect from this meeting:
new objections that I have not considered so far.
First, let's talk about money.
Well...
We are currently facing many social problems.
Society is under pressure because of difficulties
which seem mainly caused by unemployment.
In our economy where few are self sufficient...
we need money to trade between each other.
In a world where money is rare
and people who create it do not create enough,
we have to work to earn it,
so we strongly depend on jobs,
i.e. work that is willingly given by an employer.
And...
When we consider unemployment, there is something strange about it.
Jobs enable people to work in exchange for payment.
We do not lack workers, we have plenty of them.
And we do not lack things to do, we have plenty of useful things to do.
For example, we need to isolate buildings with
triple glazing to heat them with less energy.
We need to build housing for everyone.
Well, I won't tell more, there is plenty of
things to do for us all to live with dignity.
So there are people who are ready to work
and many things to do. We simply lack money.
And...
And... is it complicated to create money ?
No. It is not. So why are we lacking money ?
This is exactly my point:
understand why we lack money and discover the origin of that.
What is money ? Who creates it ? Is it hard to create ?
What are theories around that ?
I will be quick on that, but it is useful to know
the theory accepted by present economists.
And also to know alternative theories found in
human history. Some are very interesting.
And also monetary experiments, also very interesting.
I do not know all of them but...
I will tell what I have discovered so far and
you may also share your knowledge with me.
Because the number of money experiments is amazing and fascinating.
So,
how is money created today ?
I brought many books you may refer to.
I will often mention them in my talk.
About history of money...
When you learn about money, how old it is,
which form it took... you discover a fascinating story.
With a book dealing with history of money you will go through
human history and you will better understand the world today.
Because the way money became a privilege for few people,
has a great impact on the way we live in peace and prosper.
This is decisive for peace. In other words,
wars are mainly caused by bankers.
So it is crucial to understand this.
I have a huge amount of books dealing with money creation.
I selected the best of them for you.
There is a first great man, Galbraith,
he is dead, he has a son still living,
He wrote "Money: Whence It Came, Where It Went",
it is full of british humor, it is very nice to read.
He described greeds, cheatings, dirty tricks, plots...
Galbraith has a great credibility, he worked with important people.
He was a great economist together with a journalist and a humanist.
He took a stand for people against oligarchy, bureaucracy and injustice.
And his book... [Which period ?]
Mid and late 20th century, he died a few years ago.
And his son seems to be like him, a good man too.
In this book, the definition of money is great.
I put a mark on that...
I want to read it, it is very short.
He warns us...
There is something funny about that...
He explains that money is made complicated on purpose,
to confuse us like doctors a long time ago, like lawyers...
They maintain a technical jargon to keep underlings apart.
"The reader should proceed in these pages in the knowledge
that money is nothing more and nothing less than what he or she
always thought it was - what is commonly offered or received
for the purchase or sale of goods, services or other things"
Anything else is useless confusion.
Indeed, when we address money creation
and how this was stolen to the people,
we will see that it is not complicated.
There is a second book that I like, also very nice to read:
"La pensée monétaire de l'âge classique à nos jours" by Christian Tutin
"Tutin", T-U-T-I-N,
He quoted the best parts of contemporary experts on money:
from Locke to Hayek including Law, Cantillon, Hume, Thornton,
Ricardo, Marx, Fisher and of course Keynes and Friedman.
But it is not hard to read because it is the
best about money written by the best authors.
It is actually a fierce debate between
those people to determine what money is.
So a good book to understand the stakes.
I won't do history of money, I will tell you what it is now.
Today we have two kinds of money.
First, there is the money we use,
this money is mostly created by private banks.
And there is money created by the state.
A small part of it is paper money,
the other part is exchanged between banks.
So there are two kind of money.
The money exchanged between banks is not our concern.
You will never see it, it is just for banks.
And there is the money that we exchange between us.
It is hardly created by the state, it is mostly created by private banks.
How and when is it done ? Let us take an example
to see how money appears and then disappears.
Let's say, you need $100,000 for your house.
You go to the bank and say: "please loan me $100,000".
The banker does not have this amount of money,
however if you are reliable he says "no problem".
If you are not reliable, there is a chance that you
do not pay off your debt and it will become the banker's
responsability to pay it back. So he pays attention to it.
I should stand up for that. The banker has a balance sheet.
I had a drawing for that.
There are assets and liabilities.
I am a bank, assets are what I am owed and liabilities are what I owe.
Liabilities are what I owe, so you want $100,000, here they are.
This is on my account, I owe you $100,000.
There is still something wrong, it is not balanced yet.
I have to write the same amount on both sides of the balance sheet.
For now it is not balanced, but what I wrote here
as liabilities, as debt of my bank, is new money.
I shall explain how it circulates after that.
And the credit operation is not completed yet. The banker says:
"I owe you $100,000" and in the same time: "you owe me $100,000".
On the other side, as assets he writes $100,000.
He says: "now you owe me $100,000".
When a bank gives someone credit, two debts are created.
Bank and borrower together create two debts.
The debt of the bank is paid now, and the debt of the borrower is paid later.
Difference lies in term.
[3 debts are created] What is the 3rd ?
[interests] Interests... indeed...
but interests are taken from existing money.
The money is only created from the amount that
people borrow and that is granted from banks.
Then, you pay off your debt with interests. For now I leave that apart.
There is $100,000 on both side of the balance sheet and then people pay back.
$10,000 back, $10,000 back, money is progressively destroyed on both sides.
And at the end, money disappears.
Money disappears. If everybody paid his debts, there would be no money left.
Almost nothing, just banknotes and coins.
[money as debt] Money as debt, indeed.
Any money that circulates through bank accounts is called
"demand deposit". It appears and disappears just as I said.
Money appears together with debts,
and disappears together with repayments.
More than 90% of the money today was created like that.
So... how comes...
I should also tell how it circulates.
The person has this amount of money on his bank account.
With that he will pay his suppliers and his workers.
A part of this money will leave his account for another in a bank B.
And it works the same way with assets and liabilities, so let's say
$10,000 have gone, there are $90,000 left and $10,000 arrive here.
And money just go.
It is just a new entry on the "liabilities" column of a balance sheet.
Money is created as liabilities and circulates through liabilities
of banks with the help of checks, credit cards, transfers...
If you take an overview of the bank system, you see that money consists
of liabilities of all banks and circulates thanks to checks, etc...
Yes ? [It is like a unique bank]
Exactly ! They create money together, they lend to different people.
For example, I am J.P. Morgan, I hold 10% of the stock market,
it means that I am in charge of 10% of the people's money,
and each time it lends 100, 90 go elsewhere and 10 remain for me.
In the same time, the other banks lend money too and
10% of these loans eventually come into my accounts.
So if all the banks together create $1,000 during a day,
$100 are for me, whatever the source of the loan is.
Each bank has to lend in proportion of the market share of its deposits.
If a bank lends more than the others in proportion,
money will go to other banks and it will have to
raise capital, that is it will have to pay...
I think that it is useless to go deeper into the detail.
We will come back to that when we talk about objections.
Bankers pretend that it is a strong restriction to
money creation that banks are in competition like that.
But if they lend money at the same pace, there is nothing to compensate.
The money supply consists of the sum of all
credits that have not been paid off yet.
It is like a bathtub that fills up with a faucet that represents new loans.
So any new credit contributes to fill the tub of money supply.
And repayments are like the plughole from which water
flows out regularly according to the schedule of repayments.
So the amount of money supply fills and empties like a bathtub...
...but it fills in a way that has nothing to do
with our needs. Actually we need money to trade.
Image is a bit old but it is like blood in the body that enables to trade.
Blood circulates in our body, it takes particles
somewhere and bring them somewhere else.
Too much blood is bad, to little is bad as well.
It is important to have the right amount of blood
as it is important to have the right amount of money.
In optimistic periods, when we trust in the future,
we, humans tend to borrow much.
In the same time, bankers tend to lend much.
This leads to the creation of much money. money supply inflates
and it leads people to take more and more risks than they should.
I am simplifying. On the contrary, and this is what I worry about,
there is the reversed situation. People's mood switches from
optimism to pessimism, like during the real estate crisis.
And the market is under the "sheep" effect, all agents behave the same way.
When everything is fine, the market is optimistic,
and when it starts to turn, the actors start to depress all together,
they stop borrowing, bank stop lending...
whereas people keep on paying off. The bathtub keeps on
emptying according to the schedule of repayments while
it stops filling and thus you have less and less money...
and more unemployment.
The strict connection between money and unemployment is hard to draw
but this argument has been held by many theorists for a long time.
And...
the most famous is Keynes.
I think it is not stupid to correlate the amount of money with unemployment.
I am led to think so because of some
experiments with alternative form of currency.
In many cases of alternative currency in history, I observe that...
First of all, you need a serious crisis to create
a new currency: when unemployment rate is very high,
when craftsmen and storekeeper can not work...
In such situations districts take locally control of the money
and start to pay civil servants with money they create themselves.
Money is something highly conventional. You just need trust to make it work.
And in any experiment I know, it takes only a
couple of weeks to make unemployment disappear.
Activity starts again when you bring money to it.
I mean that there is a relation between unemployment and
the introduction of new money when there is not enough.
But you have to pay attention not to create too much money,
else its value might collapse and then you might face
other kind of disasters. But if you create money moderately...
you have a solution to unemployment.
But if you give the money you create to rich people like today,
to people who do not spend it and accumulate (like a sickness)
then you will not solve your problem of employment.
You need to give money to those who spend it.
Jean-Marcel Jeanneney, a minister of de Gaulle wrote a book called
"Ecoute la France qui gronde". It is out of print, hard to find,
maybe as a second-hand but I published the best parts of it on my website.
First, this guy explains that creating too much money generates hyperinflation:
money loses its value and it is a disaster for everybody.
He reminds of Assignats during the french revolution,
the John Law's system, the german hyperinflation in the 1920s.
He knows that. However he suggests that the state should create paper money,
not money for private banks, nothing you need to pay off but banknotes.
And then, without going through banks, distribute FF3,000 to any individual,
kids, elder, men, women and observe empirically what happens.
Does it create inflation ?
If not, then we do it again 6 months later.
Else we stop for a time.
He proposed to distribute money to people. But the original aspect lies
in that money is given to people who spend it. This changes everything.
Currently we create billions that we give to people who do not spend it.
They possibly lend it but with expensive interests.
About money creation I omitted a point that should be mentioned.
Until 1973 in France, and 1913 in the U.S.
the state was allowed to create money like private banks.
Banks could create money like I said but state could also
create the money he needed for itself and its investments.
For that it just needed to borrow from its central bank.
And as central bank belongs to the state, and
we are the state, the loan was without interest.
When the state paid off, it did not pay interest.
But eventually France, U.S. and Europe were victim of a monetary coup d'état.
The monetary creation was left to private banks exclusively
so that states cannot borrow from their central banks anymore.
In other words, oblige the states to borrow
from private banks for their investements
and oblige them to pay interests.
And in any country where it happened, public debt appeared.
Public debt was successfully used to enslave Third World countries,
to steal their raw materials and resources.
This happens now to developed countries.
Progressively, the state
is forbidden to create its money
and is forced to borrow
on the stock market, that is from rich people.
This way, the elected representatives enslaved the state, made it dependant.
This happens clearly in Europe today. Greece, Portugal, Ireland
are beeing strangled by the debt system and there is
most likely no way around it for the other countries.
[It is interesting to say that in 1973 this was decided
by Pompidou and Giscard d'Estaing. And who was Pompidou ?]
Pompidou was the manager of the Rothschild bank.
[As an example of what became world politics, when Gaddafi
came to Paris, he pitched his tent in the garden of the
Rothschild family. Just another interesting relation.]
I didn't know that.
Anyway. We actually often call this 1973 law, the Rothschild's law
because it incredibly served the interests of banks.
And we are the ressources of the states. The work of millions of people
is thus for a large part dedicated to pay the debt service,
to pay the banks, the creditors of the state, on public spending.
Since the state is not allowed to borrow from
its central bank, it has to borrow from private banks.
So what happend in 1973 is deeply against
general interest. It is a coup d'état.
And... the same thing happened the same way
in the U.S. in 1913 and with the same banks.
So...
I think that the most relevant book about this
period is "Secrets of the Federal Reserve".
I think that it is the best book to understand
the monetary swindle of that period.
It has existed for a long time but it was translated into french recently.
That's bomb. When you read that you get outraged.
It is easy to read, like a detective story. And it explains how...
[Eustace Mullins] Eustace Mullins: M-U-L-L-I-N-S.
It explains how a couple of bankers who were detested by the american people...
The americans just emerged from a dreadful crisis. They had been ruined,
they lost their savings and people hated banks and Wall Street.
[This was initiated by J.P. Morgan] Yes, but I cannot tell everything now.
But...
How a couple of bankers literally conspired: they hid on a private island
with a member of the Parliament to develop a project of central bank.
But a private central bank. A bank which looks like a
public bank but is not, which is called "Federal Reserve"
and which is neither federal nor american nor is a reserve.
They wanted this project to be voted by the congress. It failed the first time,
then they tried again in 1913... The plot of Jekyll island was in 1910.
All this looks like a detective story.
The servants were given vacation. They had hired new foreign servants
just for this meeting, just for one week so that nobody could recognise them.
Mullins' work is really interesting. He pieced this
puzzle together: he relied on thousands of old
articles... even on books written by the conspirators.
After the system were installed, some of them started to talk as they got older.
He managed to complete the puzzle. He did a huge
research work, very complicated and very interesting.
And we discover the same procedure, the same rules,
the same outrageous rights given to the central bank
compared to states in the current european system.
This book describe also the way this project has been voted.
These bankers financed the campaign of the three
candidates... The two main candidates who could win
the election had both a project of federal bank.
they were described as contradictory whereas
they were alike, they led to the same thing.
Finally, Woodrow Wilson was elected in 1913. The first thing he did was to
vote this project of federal reserve in a quick and dirty way, in december.
He did it against public opinion and against general interest. Since then...
I think it is relevant to describe America as an occupied territory.
These people have had their money stolen and thus have been
enslaved by some privileged guys with power beyond imagination.
You have to realize that by taking over the dollar, they took over the world.
Eustace Mullins did a major investigative work to expose the owners
of banks. There are shares and control shares which are more important...
Nowadays this secret is kept as well as the nuclear launch code.
Today it is almost impossible to know who controls banks.
Back then the information was still available and the trail of
the ownership of the Federal Reserve led to the City in London.
That's the last straw ! Can you imagine how harsh it is
for american people ? And it led mainly to Rothschild.
This deserve to be discussed in public.
Mullins might be wrong on some points, we have to check.
The problem is that we cannot discuss that
without being called a fascist or an antisemite.
It seems that antisemitism was made up to protect Rothschild. When we talk
about him we are immediately called an antisemite, a fascist... Hitler soon.
Well I don't think I have much in common with Hitler and fascists.
So, among alternative solutions, there is "Freigeld" (free money).
"Freigeld" is a concept proposed by Silvio Gesell. He was a famous
and appreciated economist who proposed something interesting.
Keynes considered Gesell's concept with respect.
Gesell tried to prevent people from accumulating money.
Indeed, other people need unused money to circulate.
So, in order to dissuade people to keep unused money with them
he proposed that money might lose its value each month. For that,
stamps had to be purchased and attached to the money to keep it valid.
Indeed, this encourages people to get rid of it since it loses its value.
But if you think about it, Keynes' solution
involving a bit of inflation is equivalent.
Inflation makes your banknotes lose their value progressively.
"Freigeld" and inflation are very similar.
Not exactly identical though. Anyway, it was
Keynes' solution to "Euthanize the rentiers".
That is a rentier...
Inflation reduce the gold pile of a rentier. Workers, however...
About protecting people against inflation...
I am a bit lost with my books but...
Concerning solutions to withstand inflation...
Maurice Allais was not in favor of inflation, but explained that a little,
2% was necessary - due to landed property, I will not explain that.
So, these 2% that Allais suggested to maintain, were compensated
by a general indexation system like France knew after 1945.
During 30 years in France, people's income were
indexed to inflation with the sliding wage scale.
Wages were indexed, loans were indexed, rents were indexed and thus,
for the workers and the little people, inflation was painless.
Only the wealth of people keeping banknotes decreased.
Actually, speculators often managed to earn more than inflation.
Only the wealth of people keeping piles of banknotes decreased.
And more people than you think keep banknotes.
For those people...
money melt away.
So "Freigeld" is a solution to prevent people from accumulating too much money.
Concerning the maleficence that happend in -73 when the state
abandoned monetary creation, I see as consequences...
a ruined state.
You have to understand that rich people have much to fear
from a strong state that they could not control.
So the strategy applied by so called "liberals"
all around the world aims to destroy the states.
And an efficient way to do that is to ruin it.
Ruin by depriving it of resources and Galbraith emphasizes
that great crisis are preceded by cuts in rich people's taxes.
It is the sign of a crisis.
When taxes of rich people start to decrease strongly,
this means that we are getting close to a crisis.
I think that Galbraihs is right. Since recently, you can see
that often, rich people pay almost no taxes anymore.
And when rich people do not pay taxes, the amount
of money that state lacks is a bottomless pit.
So first, the state is ruined by depriving it of its resources.
Second, by getting it into debt, state is
burdened with the interests of the loan.
It is burdened with additional expenses.
You have to realize that the interests of the debt,
not the refund, just the interests, cost France...
It costs us 45, 50 billions euros a year.
It is considerable ! 50 billions just for a debt,
it is just the interests, I insist, an unnecessary debt.
A debt that is not necessary. If the state...
had kept the right to create money for itself...
If it was allowed to borrow from its central bank,
that is to create money it needs...
it would not pay interests.
Besides, the amount of deficits...
André-Jacques Holbecq wrote a short book, very simple...
This short book: "La dette publique, une affaire rentable"
and this other one: "Argent, dettes et banques"...
Two good short books by André-Jacques Holbecq
that explain well and enable to understand.
He did quite a hard work because statistics were not
available anymore, so he had to go hunting for them.
Since 1973, public spending did not grow. It did not grow.
In proportion, it is roughly unchanging. So how come we are
more and more in debt ? Well look, it is the debt service.
At the beginning in -73, debt was little,
so debt service was little and thus the deficit was shallow.
And then, year after year, deficit is roughly equal to...
not exactly, but it is very close, the deficit
of the french state correspond to debt service.
By reducing resources of the state, by increasing its expenses
and year after year... you have to realize that since -73,
members of the Parliament decided not to balance this growing deficit.
They could balance it by reducing spendings or increasing taxes.
They did not. They left the debt grow.
Now we are told: "Parliament were lax"
or "they were weak"
or "they did it to be re-elected, to remain popular".
Possible, but I don't buy that.
I do not. It is possible...
I think that all this fits together too well...
This decision, year after year to let the debt grow so that
the state is progressively enslaved by those who lend money.
And eventually, the state will depend on these people. All this
matches so perfectly the interests of those who finance election...
that I can hardly believe that it is a coincidence.
I know, it is conspiracist, paranoid...
Nevertheless, since -73, members of the Parliament, the so-called "left-wing"
like the so-called "right-wing", all of them let the debt grow.
I find it too easy to forgive them pretending that
"they were weak, they wanted to be re-elected".
For me all this looks like an attempt to bring
the state to heel. To bring the state to heel.
This is consistent with the destruction of nations by the European Union.
This is along the same lines. The European Union construction takes
part in the destruction of the nations. The state that our revolutionary
fathers built in 1789 to get rid of the old aristocratic system.
And we are beeing stolen that...
by those who were the privileged of this system. This is a counter-revolution.
A lot of people write books called "counter-revolution".
We are witnessing a counter-revolution.
The privileged are erasing...
what we gained in 1789.
Well...
I am reaching the end of my talk about money, and I kept the best for the end.
Creating money aims to finance economy.
No matter whether state is allowed to create money or
how much is created, our goal is to finance economy.
For many years, for centuries, this task was entrusted to the stock market.
To public companies and to the stock market. Those who have too much money...
come to the stock market to make it available.
And those who need it to start a business, come to borrow it.
I think that stock markets are justified in case money is rare.
And it is created by some privileged people who keep it rare.
But if we consider, that money should not be rare,
if we consider this as a society, we could then design
a system where we would take back the control of the money.
And we would create... not too much money because we do not want to
live through those bad experiences where everything collapsed because of it.
People were ruined and the situation was worse than before.
Without creating too much...
I guess that we could create more money than today and also
dispatch it to other targets than what private banks do.
But if we manage to take back public control of
monetary creation, we do not need the stock market anymore.
We need neither the stock market, nor savings, nor rich people's money.
So let us grant the control of the monetary creation...
not to politicians...
I will come back to that later, but to public power, to citizens. This could be
an assembly, possibly randomly selected that decide how much money to create.
We shall discuss that because it might be
too technical for randomly selected people.
Anyway, some public power instance, an incarnation of
what we, the people are, could decide how much money we need.
This may be a way to finance economy instead of private banks.
There is another way I wanted to talk about, a wonderful work, very exciting.
This were brought to me by Franck Lepage. Franck Lepage is
an exciting campaigner, you should get to know him if you do not.
You can type his name into Google, you will find his
"gesticulated conferences" where Frank tells important things.
I cannot tell much for it is not related to money:
his main topic is about a popular education. It concerns
culture as political education of young adults to avoid wars.
Culture is reduced to art, which is a disaster.
Culture should include education of young adults on ethics.
For example Orwell's Common Decency, a kind of generosity...
altruism that can be developed and taught with a dedicated education.
So, Frank's work is about popular education: the scuttling of the culture
reduced to art and without political aspect. It is an essential work but...
we may talk about that later together with random
selection which is also a tool for popular education.
Frank introduced me to Bernard Friot's work.
I cannot talk in detail about Friot's work.
I encourage you to watch Friot's conferences, each of them is
2 hours long. I saw 4 or 5 myself, I met him, I expect to do it again.
The work of this man is essential... and revolutionary.
Before reading the book you should watch several videos because he...
he improvises in his videos and they are never the same,
there is always something new and they are rich.
One has to master his own vocabulary about job, wage, contribution.
He gives his definition of "job", his definition of "work" which is...
very useful. I shall summarize so that you
understand how it articulates with my talk.
I am trying to finance economy without rich people's savings.
I would like we, the many non-rich people, to have a normal economic
activity, to live a decent life without requiring rich people's money.
without requiring capital, without capitalism.
Without the money accumulated by...
those who have money.
Taking back money creation is a first idea. And Friot's idea...
That's another bomb. Friot says:
There is something in our current real life,
this is no utopia, this is no dream.
In our real life, there is an anticapitalist financing
system that works very well, namely our pension system.
In what way is it a major solution that demonstrate that
we are able to finance something without saving money first ?
Well look how our grandparents designed the pension system after the war.
It is easy, very easy.
We do not know what will happen in 20 years, but next year we know
how many people are going to work and how many will be retired.
We apply the rule of three and thus we know the proportion of
the wages that must be deducted to pay the pension next year.
Each year we decide the part of the wages that must be
taken to pay the pension next year. It is unsinkable.
Of course, for the baby boomer's pension you must raise
the contribution rate, like today. By the way, this rate
has kept growing since the end of the 2nd world war.
The rate rises a bit each year. This happens in a period of growth,
when wealth rises even more quickly. Each time, we create
much more wealth and we take a bit more of this new wealth
for pensions. It is painless and the system is unsinkable.
Except if you scuttle it voluntarily.
When business leaders gained to freeze the employer contributions...
when they stopped to increase... to adjust the part taken on
wages for pensions, they scuttled it. And then pretended that
the system was not viable. But they unbalanced it voluntarily.
This is sheer sabotage ! The system was designed
to be self-balanced, without the slightest deficit.
And it worked very well with huge amounts.
Pensions are 230 billions a year.
And state is not needed. These are social funds betwen us.
No state needed, no saving needed, no loan needed,
and there is no interest to pay.
These are important commitments, 230 billions
over 30, 40, 50 years. And it works very well.
Already 45% of the global salary is paid by funds.
Not only retirement but also health, unemployment... any social insurance.
Almost half of our income is already paid
by firms to funds and then by funds to us.
It is already happening, and there is no need to borrow.
No need to pay interests. No starting capital or savings needed.
Friot says: this system has existed since the 2nd world war.
It has worked perfectly since then. It should be
applied to every professional categories, to everyone.
And above all, since it works for pensions...
then let us do the same for salaries.
A firm would not pay its employee directly. It would
pay a fund that would pay him. It would be shared.
One may doubt it would work, but it is already
working for pensions, why not for salaries ?
And for investment.
Instead of entrusting the stock market that does not finance economy anymore.
You know that all together the stock market deplete wealth.
Each year, if you compare what the market takes from economy
and what it gives to businesses, it deplete wealth.
It is useless. For a long time, the market has not financed economy.
I discovered Friot's idea a couple of months ago.
It should be explored but it is very appealing.
Friot's idea is:
"Let us follow...
the successful example of pensions for 60 years.
Let us extend this system to other problematic topics", like investment.
The part of GDP that goes to investment is catastrophic.
We are far from the 25% of the GDP we need.
But if firms were asked a contribution in investment,
if firms that need to invest were able to get money from an investment fund,
we would have 25% for investment instead of relying on a useless stock market.
I think that none of these reform is possible in the context of election.
Because elected representative, for a large part...
a part that is hidden...
are answerable to their sponsors.
And if those sponsors are rich people...
the richest are not storekeepers, they are banks.
So it would be an illusion to believe that
representative would change anything about banks.
It would be equivalent to a suicide.
So what I am about to tell about sortition in place of election
is the political complement to this work on financing.
I would be glad to hear your opinions about financing systems
because I am still doing research on that.
There might be things that I have not fully understood,
or that I missed. I am still seeking...
new material.
http://etienne.chouard.free.fr/Europe