(Bromsgrove, 5-7 Oct., 2007)
Conference,
Let me introduce myself quite briefly: I have a degree in law and one in psychology, and am by profession a solicitor. I also write essays and articles, mainly on the instruments and techniques of domination, that is, the means and practices by which people dominate other people. The science studying this subject can be called Cratesiology, from the Greek ‘Kratesis’, domination.
Coming now to our topic, the question of seigniorage and the issue of money is currently enjoying an unprecedented popularity in Italy. Since the release of the 1st edition of my essay Euroslaves, (which met with success beyond expectation, with almost 20,000 copies sold – we are now at its 3rd edition, almost double the size of the first) I have been invited some 15 times by countrywide and local networks to speak on TV and some 5 times on the radio, not counting public and private lectures, talks, debates and articles in a few magazines.
I was also summoned by the Christian Serbs of Bosnia and Hercegovina, who are now in distress and at risk of being overpowered and subjugated by the Muslim majority, as these are heavily funded and supported by Islamic countries, the U.S.A., Britain and more. I gave interviews to their medias, explaining how the monetary system that was introduced into Bosnia and Hercegovina following the Dayton Agreements is impoverishing them and how they could issue a debt-free currency to support their economy, their national identity, and retain their national resources. They are now fighting for independence.
So, together with some associates of mine, I have been able to reach enormous numbers of people, as many as 500,000, according to our estimates. Of course, only a minority of them will have understood what we endeavoured to explain, and subsequently retained it. All the same, a critical mass seems to have been generated, and this has made possible what follows.
There are now several groups working on seigniorage and for money reform at different levels. Three small political parties support us to some extent: one of the 3 Christian Democratic Parties, one of the Three Communist Parties, and the National Fascist Party (which is no longer totalitarian); plus a part of the Northern League. The Vatican does not support us. The Holy See has its own state bank, the I.O.R. or Institute for Religious Works, practising seigniorage very intensively and safely, sheltered from any kind of investigation, thanks to its being the bank of a sovereign country.
A big campaign for the introduction of complementary currencies is about to be launched in Italy by a money reform network, http://www.arcipelagomoneta.org
especially in Tuscany, a region whose financial and banking enterprises in the Renaissance played a telling role in deciding the fate of Europe, and in particular of England, where they played so much havoc, plundering that country during the Wars of the Roses, and bringing the Crown to bankruptcy – that is, the repudiation of outstanding debt towards the banks.
Tuscan accountants in the Renaissance devised the accounting principles and standards which, right up to the present day, make it possible for banks not to enter their seigniorage proceeds on their balance sheets, and to disguise the machinery which creates credit out of thin air, thus making both items unrecognisable, as well as non existent, as far as the tax inspector is concerned.
Two currencies, notably, the Florin and the Tau, will be introduced this coming winter in Florence and in Lucca respectively. More currencies, the Cro and the Thyris, will be issued in Southern Italy, and still more in the North.
Two such currencies have been tested already with some success: the Scec (pron. “sheck”), or Walking Discount, in Naples; and the Ecoroma in Acilia, a town near Rome.
The Scecs in particular, although there is still only a very limited stock of them, have proved helpful, increasing the purchasing power of families and the turnover of some shopkeepers and craftsmen. Scecs have been gifted to needy people.
By ‘complementary currency’ we mean a currency which is not a substitute for legal tender, but a remedy for its scarcity, and an aid to local producers who are being challenged, if not forced to close down, by the rise of large malls and supermarkets, most of them owned by French capital.
The main general features of these complementary currencies are as follows:
They are not money, strictly speaking, but discount vouchers that can be used an unlimited number of times. This is intended to prevent legal attacks, in that these vouchers imitate the discount vouchers issued by the big mall chains that the judiciary and the government could not afford to defy, as they constitute the second largest market in Italy. We walk in their wake, as it were – we stalk the malls.
The currencies are established by general consent: that is, they are based on private agreements subscribed to by business people and city councils, which all undertake to accept them for the payment of at least 1/5 of their prices or fees.
They are not convertible into legal currency, thus they cannot become a means of storing value.
They are created and distributed freely, without any indebtedness whatsoever.
The conditions under which they will be distributed, as well as other details, will be discussed and possibly set forth in a meeting called for the 20th of this month (October, 2007).
After some debate, we agreed that complementary currencies must be free of demurrage or a negative interest rate – these two terms being both misnomers and eulogisms for a tax on money, that is, a form of seigniorage, and therefore inconsistent with our basic principles.
The advocates of demurrage thereupon stepped out of the money reform network, slamming the door and shouting that seigniorage is sheer delusion.
We expect the complementary currencies to allay the dire consequences of monetary scarcity – a scarcity that we deem to be created intentionally and maliciously. As Professor Richard Werner of the University of Southampton convincingly showed in his recent essay New Paradigm in Macroeconomics, Palgrave-McMillan 2005, the money supply, far from being regulated by the laws of the free market according to the principle of the maximisation of profit, is, in the real world, regulated by political strategies implemented by the banking system, following the principle of the maximisation of sheer power – political power.
In particular, we expect that, besides improving the purchasing power of households, the complementary currencies will sustain local production, local retail, and small businesses; and that they will remain within the locality, instead of being channelled overseas to the remote, cheap-labour markets from which the mall chains get their supplies.
But the most important factor of all, we consider, is the educational value of the complementary currencies, their power to enable ordinary people to experience for themselves, directly, in their daily lives, the secrets of money – secrets which are otherwise difficult to learn and accept: as, for instance, the fact that money does not need to be backed by gold or some other commodity in order to have a value; and that it does not need to be backed by debt either – that it can be created and injected into the market without creating any debt.
All this is a tremendous, mind-blowing discovery for all those who manage to grasp it: an over-arching discovery, one that puts the overall understanding of economics, of wealth – and of credit, of politics, too – into a whole new framework. But it is also one that may arouse reluctance and disbelief, unless it is not only clearly conveyed, but supported by first-hand practical experience. We are of the opinion that handling complementary currencies and deriving benefits from the use of them will, over a period of time, lead many people to a crucial insight into what money actually is; and that this will be achieved far more easily than through theoretical explanations or priming, thus winning a significant number of citizens over to the ideas of money reformers and to the money-reform movement.
Last Sunday, after a lecture I gave in Milan, a youth stepped up to me and said: “Thank you very much for opening my mind. If it weren’t for your books, I would still be living in fairyland.”
I do find that opening of the minds of our fellow men and women, enlightening them, awakening them from the spell under which the lies and fabrications of the establishment and the media contrive to keep most of mankind, is a noble and very valuable achievement in itself. Generally speaking, values and goals do not exist in themselves, nor in the books or scriptures, but as subjective experience of the human beings.
Enhanced awareness, an improved understanding of how things work in the real world, the dispelling of illusions – in short, the enlargement of consciousness, are momentous gains in our lives, possibly the best gains of all. The most hallowed line in the Hindu holy books, the Vedas, says “let us widen our insights” or “let our insights be widened.”
On the other hand, complementary currencies are not a structural remedy for the problems caused by a private seigniorage system, nor for a money regime based on indebtedness. They can lead people to realise how that system works, what it costs the general population and the advantages it brings to a very few. I don’t think they can perform much more than that – just as nationalisation of the central bank of issue can achieve nothing, if the present untruthful accounting standards are maintained, and if private interest and capital take possession of the state itself.
We believe that the dissemination of knowledge regarding the nature of money and seigniorage is a much more powerful means of generating a demand for money reform, notably because these topics, in connection with the tax issue, appeal to entrepreneurs, who obviously have far greater means at their disposal, and who will also be more dedicated than the general population in pursuing the issue.
I would certainly recommend that the question of untruthful accounting standards for banks – the I.A.S., or International Accounting Standards – should be raised and brought to the attention of entrepreneurs, trade unions, consumer unions, and economists; and that these people should be made aware that such standards have been engineered with malicious intent to conceal seigniorage proceeds and the machinery of credit creation out of thin air at virtually no cost or risk to the banks. I would also recommend telling them that if those standards were reformed, the banks would have to pay tax on their profits, which otherwise would remain invisible; and also that one major function of the contorted Basle II Regulations is to create a fog of confusion, to hide the fact that the fractional reserve system has come to an end, and that credit, liquidity, is now created without the least backing in hard currency or any other medium.
To be frank, I am pretty certain that the existing system, however bad and unjust it may be, cannot possibly be reformed unless general conditions change dramatically; not only because those who currently hold and benefit from monetary sovereignty will never hand it over, choosing rather to resist any serious attempt to overthrow their rule and dispossess them of their privileges by any means, including force and mind control technology, but also for other reasons.
Monetary empowerment of the nation would be equal to implementing democracy: and throughout the whole of history, democracy has never existed. All societies are ruled by oligarchies, no matter what picture they present in their formal constitutions. No social or political psychologist believes in the possibility of democracy, unless by this word you mean the manufacturing of consent and compliance: unless you mean a pretence of democracy, leading the masses to accept whatever the rulers decide to do. Take the war on Iraq as an instance, the way it was made acceptable to the general public through lies and forgery.
Democracy cannot be implemented in the real world for a number of practical reasons. One of them is that it presupposes that all or most citizens have an adequate understanding of the functioning of society, economics, the world, the issues they have to vote upon; and that they are not manipulated, not gullible. But then the most relevant information is kept secret, is withheld from the general population. Just think of the science of money! How can democracy exist when only a negligible fraction of the population are aware of things like seigniorage? You will also agree with me, that very few people take the trouble to learn enough about all it’s necessary to know in order to vote or debate competently. On the contrary: the general population is massively manipulated through the media, and by more subtle means of disinformation and mind control.
Today’s de facto polity could be described as a remote, unaccountable, invisible autocracy committing invisible crimes while hiding behind formally democratic institutions – institutions which are left there in order to incur debts and take the blame for all that goes wrong. Real power is vested in corporate monopolies and trusts, such as the banking monopoly of money-and-credit creation and destruction; or the monopolies of commodities or the Internet or other technologies. You will be familiar with the notion of corporate takeover of the State’s functions and powers by private capital. Central banks, the WTO, IMF, WB, the EU Commission and so on are privately managed agencies, if not privately owned – virtually, if not statutorily unaccountable. The power is theirs. Parliaments are supplanted, overridden, reduced to stewardship.
The whole Earth is, as it were, enveloped in a network of financial agencies whose business can be likened to that of the mining industry – only, instead of extracting ore from underground, they extract value, purchasing power, from an unknowing society; from the workers; from the productive economy.
Seigniorage on legal currency and seigniorage on credit (the latter amounting to approximately 50 times the former) are not the only means to carry on that process of extraction – other procedures have recently been disclosed to me by businessmen who, after reading Euroslaves, decided to discuss this topic with me and with certain clients of mine.
In this oligarchic, elitist structure of power, the top of the pyramid – which is identical, in my view, with the lords of seigniorage – is literally taking off from the bulk, the lower layers; and everything possible is being done to increase the gap, till, with the dismantling of the middle classes, it becomes so wide that the separation will be irreversible and final. Remember the pyramid on the U.S. dollars: its top, with the triangle and eye inside it, is featured as taking off from the rest. We should always be mindful that, in our own eyes, we are human beings: but in the eyes of the ruling elite, we are cattle to farm, exploit and eventually dispose of.
That system will probably come to an end, one day – but not through our efforts. It is far too powerful Rather, it will rot away or collapse of its own accord, owing to its inherent contradictions. Nevertheless, such efforts on our part should not be omitted, because, as a side effect, they are bringing about a wonderful expansion of our consciousness.
Many of you will not like to hear this, some of you may find it paradoxical, but we are fighting a battle that could be lost before it begins, if our goal is solely to achieve money reform and liberation from seigniorage. But it is also a battle that we are winning day after day, in terms of individual enlightenment and personal fulfilment.
I agree with what was said during yesterday’s session, that the cause is the current system itself, not individuals and the individual choices they make. What we have not analysed yet, is why that system is maintained, even though it tends towards self-destruction; and how, realistically, it could be changed into a fair, equitable and efficient system. Therefore, we need to resort to Praxeology, from the Greek ‘praxis’, action – the science that studies causes, the natural laws that control the behaviour of human groups, both formal and informal: societies; organisations; corporations; political bodies, etc.
When dealing with economic issues and seigniorage, we are chiefly concerned with the most significant forms of behaviour – the aggregate behaviour – the behaviour of corporations, of banking systems, of political parties and institutions, of markets.
The behaviour of these groups is determined far more radically than individual behaviour by money and the pursuit of financial profit, because economic choices are choices between alternative allocations of resources, and the allocation that guarantees the highest payback wins, and attracts the funds.
The comparison of alternatives is a quantitative calculation and is therefore based on measure, on the measurability of costs, risks and expected paybacks. Anything that is not measurable, cannot be compared, cannot be factored in, cannot be entered into the accounts, the balance sheets, the business plan. Since this is the case with human values and feelings, natural beauty, pollution, fellow-feeling, justice, none of these things can affect corporate policy, and hence the policy of our corporate societies. That is why the behaviour and structure of society, and especially corporate behaviour, are determined by money and not, or only marginally, by human values.
Once people identify reality with quantity, with things that are defined by quantity and are limited, like space, matter, time, energy, labour – once people do that (and this is what people have been doing, whether they are aware of it or not), then, as a consequence, their obvious goal is to possess as much of those quantities as they can, even if it means taking them from others, and even in order to gain power over others, since people, too, can be counted. Hence, conflict is generated automatically and inherently by this paradigm of reality.
Because of that, we shall never achieve the money reform we desire, nor democracy, nor the rule of law, until people themselves, and their paradigm of reality, as it were, have also been reformed.
Religions can do little in this respect, because they all maintain that matter, time, etc., are reality, or at least the worldly part of it. They are inside the present faulty paradigm. What they actually do, is implant in people other, altruistic values, contrary to self interest, thus encouraging guilt, inhibition and conflict, instead of liberating us from conflict. The conflict is shifted inside: from interpersonal, it becomes intrapersonal. What we need is, rather, a rational criticism and refutation of the present paradigm, and practical techniques to set ourselves free. My new book, The Code of Mâya, appearing in November 2007, is dedicated to that goal.
Thanks for your attention.
Marcodellaluna.. Outstanding 🙂
Great Blog!