Anyone attempting to explain the workings of the present financial system to the friends and relatives who are its victims tends very quickly to come up against a brick wall. Economist Galbraith may have said that the “process by which banks create money is so simple that the mind is repelled”; but it is actually the inscrutability of present-day economics, with its insider vocabulary, its mathematical hieroglyphics, and its intimidating charts and graphs, not its simplicity, which is calculated to repel most of us. No wonder the usual conclusion is, “Best leave it to the experts”.
This is a ridiculous situation. After all, what we are dealing with here is not merely some academic expertise but a day-to-day practicality of living. Money is the tool which enables us to provide for ourselves and our families, both now and in the future; and it should be possible for us to do this without taking a degree in economics, and without appointing expensive financial advisors to assess the complexities of the monetary casino and tell us where to place our chips (always pleading “not guilty”, of course, when we lose our all).
The complexities have increased over time, as successive generations have attempted to deal with the problems, or exploit the loopholes, of a financial system based on debt. Yet there is no intrinsic need for such complexity, if the goal is simply to provide people with an efficient and stable means of exchange and distribution.
There is no reason why we should not reject all this complexity in favour of a system which the average person can understand, and can manage without undue assistance from (and potential exploitation by) expensive, and frequently unreliable, professionals. After all, when economists themselves are at war over so many issues, and when their learned prescriptions so often lead to disaster, something pretty basic must be wrong.
As Aristotle pointed out (contradicting assumptions that systemic debt is a condition as immutable as the workings of the solar system): “ … money exists not by nature but by law, and it is in our power to change it”; and when we change the laws by which money is issued, those other laws which previously governed the process, and the effects attendant on them, no longer apply.
In fact, one of the many beneficial outcomes of money reform, as far as the vast mass of ordinary people are concerned, would be a monetary system which can be readily grasped by anyone in command of GCSE maths.
As money reformer Marco Della Luna said at the Bromsgrove Conference in October, 2007, regarding the introduction of complementary currencies in various Italian cities:
“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 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 …
“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, thus winning a significant number of citizens over to the ideas of money reformers and to the money-reform movement.”
Reform of the financial system will make many of the old assumptions and practices regarding money, and the complexities which these practices have engendered, obsolete. Those trained in the dogmas of orthodox economics will find it hard to imagine a system based on completely different premises, and will continue to offer objections arising from ingrained faith in the very beliefs which have led to the present crisis of accumulated systemic debt. (No doubt objections will also be raised by anyone who is in a position to profit financially by manipulating the complexities of the present system .)
However, the vast majority – not to mention the productive economy – can only benefit from the increased simplicity and transparency which must be one of the aims of any worthwhile reform.