This post first appeared on Russia Insider
The author is a regular reader of Russia Insider who was submitted this article in response to an essay from a leading Russian conservative, Christian, traditionalist activist and philanthropist, Levan Levadze, Russia and Other ex-Soviet Countries Do Not Control Their Central Banks - This Must End!
Any country that does not have full control of its own financial affairs is not truly sovereign. No matter how well intentioned or patriotic it’s leaders may be, it will always have to operate within the artificially strict confines of current economic theories and the dominance of the international financial system.
The international financial system (or, more correctly, the international banking system) may or may not be run by deliberately evil people but the top of this structure is dominated by a disdain for nationhood and thus also a disdain for community and family, a peoples’ heritage and personal freedom. No matter how noble its propaganda may sound the appalling and destructive drive for any sort of “world order” always will create “disorder” and harm.
Such a highly centralized and powerful structure cannot be anything other than a war against reality and the ordinary human spirit. It is the opposite of that for which Christ sacrificed Himself. His sacrifice teaches that the True God, our Creator and Creator of the entire amazing and bountiful universe loves each one of us intimately.
Among other things when He walked on this planet He stated that He came “that we might have life and have it more abundantly” (John 10.10 KJV) This statement is too often thought to have only a spiritual meaning but is that correct? What about His teaching;
“Look at the birds of the air, that they do not sow, nor reap nor gather into barns, and yet your heavenly Father feeds them. Are you not worth much more than they? . . . 28 And why are you worried about clothing? Observe how the lilies of the field grow; they do not toil nor do they spin, 29 yet I say to you that not even Solomon in all his glory clothed himself like one of these. ” (Matt. 6:26-29)
Surely “life” means also our physical welfare and any sane person knows that it is nearly impossible to develop a deeper sense of spiritually in the midst of grueling poverty or overwork. Love is suppressed when there is little opportunity for relaxation and reflection and these require economic security.
Puritanism dominates our financial and economic theories. It insists that life was not meant to be easy. We know that life has difficulties and tragedies and these can often lead to wonderful spiritual growth. But this should never be an excuse for allowing deliberate and unnecessary hardship. If God Himself had believed this then why has he given us such a well provisioned earth. Most countries have a wonderful array of natural resources in abundance. In a country such as Russia this natural abundance is huge. Surely, to allow any sort of poverty while being surrounded by such abundance is an affront to God and a dereliction of duty by a country’s political and spiritual leaders.
All present economic and financial theories that deny God’s gifts of physical abundance to everyone are not in accord with reality and therefore must be either abandoned or modified if we are to properly advance in a truly civilized way.
I agree with Levan Vasadze (“Russia and Other ex-Soviet Countries Do Not Control Their Central Banks - This Must End!” Russia Insider Tues., May 8, 2018 that economics and money are frequently boring subjects but he is right to insist that we need to examine such matters. Most importantly we need to dissect the money system. What is it? How has it developed? and the biggest question of all: What is money?
Here is something that money is not. It is not wealth! This is childishly easy to prove. But firstly we have to free ourselves from a myriad of lies and misconceptions about money.
I repeat. Money is not wealth. It is a numbering or measuring system in the same way that our systems of weights and measures are measuring systems. When a carpenter, for example, measures a length of wood, he does not consider the measurement to be the real thing. It is the wood that is real. If he is building a house he cannot do so with lengths of metres or yards and feet. He builds it with the wood. His system of measurement is an aide that adds greater efficiency to the process of the house construction.
In exactly the same way money adds greater efficiency to the production and distribution of goods and services. In this respect it is both a measuring (or accounting) system and the means whereby real wealth (goods and services) can be distributed to whomever and wherever required.
To a man dying of thirst or starvation all the money in the world is worth less than a glass of water or a few mouthfuls of nourishing food. The form that money takes, whether notes and coins, cheques, bonds, gold, silver, sea shells, etc., is completely irrelevant because they won’t save his life - UNLESS he can exchange some of it for urgently needed REAL physical wealth such as a glass of water.
Here are some facts that can be easily verified:
Banks do not lend money that is deposited with them. All bank loans are issues of new money. Deposits result from bank loans, not the other way round.
Money does not circulate as claimed and taught by university economic departments. Hence, the terrible deficiencies and confusions in the minds of trained economists. New money is being constantly created and is withdrawn (canceled out of existence) every time a loan is repaid.
In an over simplified form, all businesses have two basic cost categories: 1) their overheads such as loan repayment and loan servicing (interest), rent, electricity, raw materials, etc., and 2) wages, salaries and dividends. A business MUST recover all of its costs from the sale of its finished goods otherwise it will go bankrupt. However, consumers (which is all of us) collectively only receive the amount of money that is issued as wages, salaries and dividends. Those few economists that have even looked at this problem usually insist that in one way or another all money spent by businesses eventually becomes purchasing power. In a sense this is sort of correct, but it ignores the factor of time. Within any period of time, whether it be a day or a week, a year or ten years there is ALWAYS an insufficiency of purchasing power. Costs always exceed available purchasing power.
Instinctively, many people rightly acknowledge the deficiencies of the present financial system and its creation of unnecessary insecurity and poverty as well as the appalling waste, destruction and pollution it leaves behind. However, promoting alternative currencies without gaining a proper understanding of the role and nature of money, or suggesting that people learn to be more cooperative and function without any money will not, I believe, get us very far. Attempts to implement them may turn out be little more than rearguard actions in a retreat from the possibility of a greater civilization. These schemes as presently offered play into the hands of the present money masters, the Merchants of Debt as the late Jeremy Lee of Australia described them.
Our societies are already informal cooperative economic associations and what we really need are some modifications to the existing financial system. Provision has to be made for the issue of some purchasing power directly to consumers and this has to be issued free of increased debt.
This shortage is presently and clumsily overcome by the banks issuing loans (consumer debt) directly to consumers in various forms such as home mortgages, credit card debt and various long-term payment schemes. The shortage of purchasing power within a country is also the primary driving force for massive exports and leads to trade wars which historically have contributed to starting military wars.
The completely unnecessary 1930s financial depression did produce at the time a great deal of interest in alternative money schemes. One of the then most popular movements came from some insights offered by a British engineer Cliff Douglas. After World War I, Douglas wrote a treatise titled Economic Democracy and later several other books and booklets and gave many speeches around the world. During the 1930s and in the decades after numerous thousands of his books were published. He also contributed to several government hearings on money and banking, such as the British Macmillan Committee in 1931.
Douglas was an engineer, not a trained economist. His suggestions stemmed from a study of the money system as a man-made system of accounting rather than as some sort of etheric mystery that is beyond our control and comprehension. It was the same approach as would be quite sensibly taken to repair a machine that was not performing properly. He had opportunities to present his findings and suggestions to people high up in banking and politics. I find it interesting that he seems to have concluded that some in the higher levels of banking understood there was a fault in present financial policy, but saw this as a tool for political manipulation, rather than an opportunity to make healthier societies.
Douglas was a traditional-minded Christian and he believed that the Incarnation (God becoming a man in an act of incredible Love) had a practical as well as spiritual purpose.
To those who say that it is inevitable that the Russian people must suffer economically from the US’s sanctions I say this is not correct. Instead it is an opportunity for thinking people to ask why there is any poverty and material insecurity at all when we are all surrounded by so much real wealth. Foreign sanctions do not reduce the amount of farm land in Russia. They do not reduce the natural resources. They do not reduce the skills and manufacturing capabilities within Russia.
Constant and ever-increasing production is not necessary once a people’s material needs are being satisfied. The constant push for ever-expanding production is just a futile attempt to solve the present chronic shortage of purchasing power within societies and contributes to a wrongful attitude to the purpose of work. It harms people and it damages the natural environment.
For thinking people who want an in-depth examination of the deficiencies of the financial system I recommend a book Social Credit Economics by Oliver Heydorn available from Amazon and book depository.
I also recommend this recent YouTube presentation by Charles Pinwill, Dividends for All. It is quite short and easy to watch and the presenter knows his subject well.
And I am happy to enter into correspondence with any one interested in discussing this matter further.
This post first appeared on Russia Insider
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