I agree with Michael Lane -- The
end of poverty,
pollution and recession can be
paid for, after
lawmakers enact programs to do
this (that await
only the money to pay
workers and vendors to
bring them to life), IF lawmakers will take
money
and price in hand.
I further agree that loan-based
money works as
Michael suggests -- it is
created when the
borrower spends.
If
the borrower siphons off enough profit
(or earns wages or other money)
and repays the
loan, repayment has an
effect on monetized
demand in the whole of a market
economy.
The effect is not the same as would be
the effect of sending gold coins
to outer space
if gold coins were our only
money. But there is
an effect on price -- and if one
fears inflation
the effect is
favorable.
Michael goes on to indicate that
a people's
dividend to increase purchasing
power for
people in need of money to
buy a decent
standard of living can be created the
way
bank loans create money. Such
people in
need would receive the money
from govern-
ment -- not from a bank or a
loan.
So where would the government
get the
money to pay the dividend
?
Michael indicates government
would create
the money, like the banks do,
but there would
be no loan to repay.
Only a government whose
constitution allows
such debtless money can do this.
That rules
out Alberta, and the fifty
states of the USA.
Alberta tried to tax bank
profits to supply the
money involved. The courts
stopped this
method. If they had not, it is
doubtful that
bank profits could have paid a
big enough
dividend to raise the living
standards of
people in need -- remembering
that the
dividend must stimulate production
enough to put real food on the
table.
Michael does not go on to
describe how
central government will create
debtless
money and avoid its inflationary
effect.
The Social Credit doctrine in
this matter
is to continue our practice of
taxation
to do this.
I agree this would
work. But those
who
will have to
pay the tax must
approve the
creation of
debtless
money.
My system of Debtless, Taxless
money
avoids the opposition of
taxpayers. But it
gives more
work to lawmakers who must
design an inflation fighting
regime out of
subsidized production methods and
highly rewarded savings systems.
On production and subsidies and
R&D
and similar support of the economy by
the central and subordinate governments,
Social Credit and I are probably
in total
agreement.
On tax and savings programs I
think SC
will need to be
persuaded.
SC might agree that
IF people and firms
save money in a government
account --
like a social security account -- I call it an
Individual Estate Account (IEA)
or for busi-
ness entities, a Business
Savings Account
(BSA) -- if they do this, it is the same as
if they paid taxes.
Government holds
the
money out of
circulation.
When IEA owners want their money
back
to spend it -- they get
it. At that point such
spending can cause higher
prices. My plan
fights such pressure on price
with more
production and more savings by
other
account owners.
As a reward for saving, account
owners
have the balance indexed to
prevent any
loss in purchasing
power.
So my system calls for Debtless,
Taxless,
Indexed, Fiat Money
(DTIFM).
The fiat word says up front that
the money
is based on its systematic
favorable effect
on price -- achieved by
subsidized production
and rewarded savings -- and is
based also
on the law (the US constitution allows this).
It
is not based on the collateral value
of pledged assets -- although it bears a
similar relation to future
productive output,
as well as, existing assets that
may come
on the market for
sale.
I know DTIFM may seem more to
SC
advocates than they want to take
on.
But it makes more sense and is
aimed
at winning over taxpayers to our
side.
What if severe inflation follows
the use
of DTIFM -- the program has to
have a
conditional welcome mat out to
some
taxation. But that taxation must
be aimed
at stopping inflation and ending
poverty.
Its first form might well be to make,
say, net savings of 20% of income compul-
sory for all people earning 30% more than a
a living wage. As supply
overcame inflation,
the compulsory savings would be
eased.
There would still be no tax at
all on people
who earned only 130% of a living
wage.
