Debt and lending can be very useful, especially when people want to take out a loan for a house or a car or starting a business. In the proposed system, there will be no shortage of lending into the economy, access to credit and lending to businesses, but the overall debt burden should be much lower. At the moment we have to borrow all of the money that the economy needs to run on, so for every £1 in the economy, there is £1 of debt. Under the proposed system, money is created free from debt, and money would no longer be ‘temporary’ but instead like a system of tokens that circulate forever, being lent and spent around the economy.
Posted in: 3. The Positive Money proposals