True political democracy can only be built on the foundation of true economic democracy. It is the duty of democratic government to secure the results the people want from the management of their public affairs as far as such results are physically possible and morally right. Whatever is physically possible is financially possible through appropriate democratic and just transformations of society’s economic institutions.
|1. Goods and services are needlessly expensive|
The cost of borrowing is in the price of all goods and services. This includes the borrowing costs of the suppliers (and the borrowing costs of the supplier’s suppliers) as well as the borrowing costs of government (which make for unnecessarily high levels of taxes all of which, in one way or another, are included in the price of a good or service).
2. Consumers are impoverished
Separately from having to pay for the cost of borrowing in goods and services, consumers are impoverished by the cost of their own borrowing be it for a mortgage or a credit card. People have to borrow when they have insufficient income.
3. Inadequate demand
As a result of the above, the economy has inadequate demand with consequences for jobs and prosperity.
4. Effects on business
The inadequate demand holds down wages, causes job losses, encourages cheap imports and leads to jobs going abroad.
Interest, and the effects of interest, is the biggest cause of inflation. This is usually ignored because people have been conned into thinking that nothing can be done about interest. When interest rates go up, there may be a temporary lessening of inflation as demand is reduced but, in the long run, increased interest rates mean increased inflation.
6. Effects on international trade
Exports bring in foreign currency which, for the exporting nation, does not have debt, and interest, attached to it. But when a nation imports, the money used to pay for the imports usually does have interest attached to it. Therefore exports are not mere opposites of imports but, somehow, in order to pay the added interest, every nation must export more than it imports – which is impossible.
7. Third World debt
The funds of the International Monetary Fund (IMF) are created out of nothing whereon interest is added. A nation in financial difficulties, therefore, soon ends up repaying (if it can) much, much more than it originally borrowed! Today, the poorest nations borrow and then have to export everything in an endeavour to repay the interest, rather than paying for their own needs. Inevitably, they then have to cut back on their own health and education programmes with disastrous long term effect.
8. National debt
In the UK, the National Debt is around £400 billion (and £26 billion in 1960) with an annual repayment of interest of around £20-25 billion. This is such an appalling – and yet, quite unnecessary – sum that little else can be said except that the total National Debt, and the interest payable on it, can be expected to rise steeply, if not exponentially.
9. Insufficiently productive consumers
The debt-based money system inevitably ends up concentrating the ownership of productive wealth. A widespread ownership is essential for prosperity and a deepened democracy.
10. No secure income
The system does not, and cannot, have a secure income for all individuals.
11. Money is used for speculative purposes, not production
Most money today is not created for the purposes of production and new wealth. Rather it is used for speculative purposes building unsustainable bubbles which, when they burst, cause disaster for millions of people.
• Money is society’s money and its creation, and the full benefits of that creation, should not be a privilege granted only to the few.• As a universal and fundamental right, every citizen must be allowed to play a full part in economic production which, in practical terms, means being allowed to participate in the ownership of future productive assets. The issuance of credit for capital investment must be democratised so as to spread widely the ownership of self-financing productive assets.
• There is a sharp distinction between:–
i) credit extended for producing wealth, and
ii) credit extended for consuming wealth (today people are bombarded with invitations to borrow, at interest, of course).
The former is designed to increase the productive power of the borrower (a good thing) while the latter creates artificial purchasing power that has historically weakened and enslaved the borrower economically (in the long run, a very bad thing).
• The wealth gap between rich and the non-rich must be narrowed.
|a) interest-free (as qualified by the paragraph above) for Justice purposes|
b) interest-bearing for those parts of the economy not covered by the Justice proposals.
• public capital investment, or
• private capital investment
"Seven Steps to Justice"
by Rodney Shakespeare & Peter Challen
|Published by |
NEW EUROPEAN PUBLICATIONS LIMITED 2002
188 pages 215mm x 140mm Paperback
ISBN 1 – 8724 – 1027 – 8 Price £10-95
|This book is available at www.amazon.co.uk or through UK bookshops |
or by mail order –
£11 including postage to:
21, Bousfield Road,
London, SE14 5TP
Tel: 020 7207 0509
|• There must be public acknowledgement that the present banking is an unjust monopoly that creates 97% of the money supply as interest-bearing debt.|
• State-issued interest-free loans (plus a small cost for administration expenses) should be used for public capital investment thereby halving the present cost.
• State-issued interest-free loans (plus a small cost for administration expenses and a possible cost for loan insurance) should, on market principles, be used for private capital investment if such investment, using the mechanisms of binary economics, creates ownership stakes and property incomes for all income groups, including the poor.
• State-issued interest-free loans (plus a small cost for administration expenses and a possible cost for loan insurance) should be used for loans to start-up and small business.
• Since the Steps above are counter-inflationary and ultimately diminish the money supply, debt-free non-repayable money should be issued for individual secure incomes to the extent necessary to keep a stable level of prices.
• That, in addition to the Steps above, the position, role and economic position of women in the world be specifically addressed.
• That the Steps above be implemented as the only possible long term solution to get peace in areas such as the Middle East, Kashmir and Iraq.
See the Canadian website of the Committee on Monetary and Economic Reform: COMER has a particularly helpful video - The Creation of Money and its Consequences:
See also the websites of the following organisations:
So let’s demand the Five Justices!
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See those who have joined the GJM! Compare Global Justice with present Capitalism and Socialism!
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Global Justice – the true, fair, democratic and efficient solution to poverty. Global Justice means Inclusive Justice!