We need a serious public and political debate on the pros and cons of the current monetary system, the alternative of public money creation, and on how system change might happen. In particular, because many experts tell us the next crisis is already in the making. The consequences of such a crisis will be even more severe than those of the 2008 crisis. On the one hand because the latter is far from over, on the other because under the present monetary system governments will no longer have the means to limit the fall-out of such a collapse. Political parties but also civil society – trade unions, environmental organizations, associations representing the interests of small and medium enterprises – should insist on such a debate. The media should play an important role in facilitating such a discussion. Economists who are willing to think and work on developing alternatives can play a key role. Economists unable to push themselves beyond the out-of-hand rejection of system change and blocking an open discussion should, after being heard, be ignored.
We, ordinary citizens, should not allow ourselves to be excluded from the debate by people pretending to have all the answers, even if they are high-ranking academics, officials or otherwise enjoy high status and prestige. We will have to part from the premise that economists, although very intelligent and clever, are so deformed by their training and profession that rather than practicing science they proclaim a faith: the belief that the market will put things right. We cannot hinge decision making on our monetary system, our economy, our society and our future on the tenets and dogmas of a science with such serious shortcomings.
The analogy with power generation comes to the fore once more. We don’t leave decision making on whether or not to use nuclear power to nuclear physicists but, after intense public and political debate, decide ourselves, democratically and based on a thorough assessment of the advantages and disadvantages of this form of energy and its alternatives. Even though we do not understand exactly how a nuclear reactor works, we do note the outcomes of this form of energy generation, compare it to other forms, and arrive at a decision.
Actually this analogy applies only partially. When deciding on nuclear energy we give, if we are prudent, significant weight to the opinions of nuclear physicists, engineers, and other energy experts. But unlike economists nuclear scientists have developed adequate knowledge: nuclear power plants work. Economists, as a result of the shortcomings of their science, their distorted picture of reality, theories based less on reality than on faith, and the unrealistic assumptions needed to make their mathematical models work have much less relevant knowledge on the economy.
The above does not mean that, if they manage to put aside those mathematical models and use their intellectual capacities for a thorough analysis of past and present, economists cannot contribute hugely to the discussion. So we should listen, but reject all that which derives from mainstream economic belief and its dogmas. In other words, we should accept and follow up on the opinions of the alleged experts only if it is supported by well-balanced arguments and factual analysis.
The fight against economic dogma and thus the current economic order is likely to be fiercer than the fight anti-nuclear activists engage in against the nuclear lobby. This is partly because the battle is not fought against engineers and scientists but against the faithful. And also, because economic faith is not only espoused by economists but also by most of our political elite and the media.
Most important is that we should not let ourselves be discouraged by the argument that money and money creation are complex issues that even many experts don’t understand well. Because no matter how complicated economists and other financial experts make it, the simple fact is that after all is said and done, money is something very simple, a symbol that works as long as we have faith in it and of which, within limits, we can make as much as we deem necessary. That’s the simple but correct starting point of the discussion we must engage in.
That discussion should be sought in particular with those who represent us and are uniquely responsible for the public interest: the political elite. Getting the topic of money creation and our monetary system on the agenda will require broad public support from all those who have in mind both their own interests and those of others: those still suffering from the 2008 crisis, the poor in North and South, those who have no access to proper education and health care, those whose health is suffering under environmental pollution, and above all, future generations.
The faster the transition to a public monetary system takes place, the better. Realistically speaking, though, it can take a long time before such major change is achieved. It will probably require a new crisis, even worse than the 2008 one – a crisis which according to many experts is close to inevitable.
Maybe we can learn something from the famous economist Milton Friedman, proponent of the Chicago Plan but later in life also a far-right economist with a strong aversion to anything remotely resembling government and state intervention. For several decades Friedman laid the foundations for the policies that were implemented in the early 1980s in the United States and Britain under the Ronald Reagan and Margaret Thatcher administrations. He described the way of bringing about major change as follows:
“Only a crisis – actual or perceived – produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable.”
Friedman wrote this more than twenty years before Reagan and Thatcher brought his ideas into practice.
The lesson we can learn from Friedman is that if the opportunity arises to move from private to public money creation the plans to do so should be ready. For Great Britain and the United States significant efforts have already been made by such organizations as Positive Money and the American Monetary Institute. The plans these organizations developed are probably also applicable for other countries and possibly, monetary unions such as the Eurozone. For each country or group of countries detailed, well worked out plans and draft bills should be prepared and be ready to use. 
As already mentioned there are many economists who are critical of the perspectives, outlook, theory and practice of mainstream economics, and who can think outside the box. That’s a good thing because we cannot do without their help. Such economists will be indispensable, in the first instance to overcome the barriers thrown up, consciously or unconsciously, by mainstream economists in defence of banks and the financial industry. And secondly, when that barrier is torn down they will be indispensable in the fight against the interests that draw so much benefit from our present monetary system.
Dutch economist and monetary expert Roelf Haan, an early monetary reformer, sees an especially important role for academic economists, as they can be more independent in their thinking than their fellow economists in government and industry. Haan sees it as a task for university teachers and researchers to educate the public and policy makers – also when running the risk of their advice being rejected.
Let’s hope that academic and other economists accept the challenge of Haan and start contributing to convincing our politicians that reform of our monetary system is not only possible but necessary. Likewise politicians will have to abandon the beaten track. In line with Friedman, Haan suggests that politics should be seen not only as the art of the possible but even more so, as the art of making possible tomorrow what seems impossible today.
 In 2011 US Congressman Dennis Kucinich of Ohio presented a bill to the US House of Representatives, the “National Emergency Employment Defence (NEED) Act”. This proposal, developed with the support of the American Monetary Institute, was based in part on the monetary reform proposed in the 1930s Chicago Plan.
 In “The relationship between the financial sector and the real economy” (Dutch De relatie tussen de financiële sector en de reële economie), 2012, https://docs.google.com/file/d/0B7iNQWnaw2FBUmxXWGdBdVI0bXM/edit, Haan cites from statements from the 1970s by the well-known Belgian-American authority in international monetary economics Robert Triffin, professor at Yale University. It should be noted, however, that since then times have changed: unfortunately, over the past decades academic independence has been compromised increasingly by governments encouraging ever closer links between universities and industry, directly and by forcing public universities to generate more income by working for private enterprise.
This was the 9th chapter of the booklet “Our Money” by Frans Doorman. This booklet explains, in plain English, what money is and how our current monetary system came about. It discusses the problems inherent to the present system and proposes an alternative.
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