Report by Harry White, Positive Money local group Cardiff:
Positive Money local groups in Wales have presented the Secretary of State for Wales with two letters.
The first draws his attention to the current system where our politicians have given away the Government’s sovereign right to create our money supply as a debt fee utility, which provides a State income, known as Seigniorage, that can be used to reduce taxes. Instead, they have given privilege of creating our money to high street banks where the banks charge a hidden tax for the use of this money which is issued as a debt.
With the current system the quantity of money issued, Instead of having a stable value related to GDP, thus keeping price inflation at or near zero stability, increases the money supply when banks make loans and decreases it when they reduce the level of loans. This results in economic “booms” followed by disastrous “busts” causing destructive levels of unemployment. The recent ”boom” and ensuing recession is the greatest in modern times since 97% of our money is debt based and issued by banks.
The Positive Money campaign calls on the parliament to reverse this policy and return the power of issuing our money to the state with precautionary rules to prevent any government using this power for party advantage.
Positive Money reminds us that the organisations that create our money hold the real reins of power and that the current system undermines democratic government.
The Wales Groups urge the Minister of State to break the “Wall of Silence” and open the debate in Parliament and advocate the formation of a Select Committee on Monetary Reform.
The second letter relates to another initiative of Positive Money called “QE for Jobs” and this could have an immediate effect in reviving the real economy and in increasing employment from the current demoralising levels.
Many Welsh citizens note the use of Quantitative Easing where the Bank of England has created £375 billion of new money in an attempt to get the economy going again. Instead of putting this money into the real economy, where it could support SMEs and real jobs, it has been distributed, via the Banks, into the non productive financial markets causing harmful volatility in national currencies, food and raw material market prices.
This CRAZY policy was aimed at a productive (private) sector recovery but the Banks are more concerned about their own profits and their actions have resulted in the secondary equity stock market prices (nt values) being near their highest ever level, even though around 2.5 million people can’t find jobs at all and a further 3 million people who can’t get enough hours of employment with zero hour contracts an increasing result. Meanwhile, over 500,000 people have become dependent on food banks to live.
Savers, particularly pensioners get near zero interest on life time savings and the purchase of gilts by the banks, under this form of QE, has reduced yields and resulted in a 30% fall in annuity rates since the crisis began. This will disastrously affect the pensions of people retiring at this time.
Positive Money have recently announced a plan to start a new campaign (codename “QE for Jobs”) – which would ask for £50 billion to be created by the Bank of England and spent by government with the aim of increasing employment and doing some of the long-term things that are essential for this country. Instead of seeing more Quantitative Easing money flooding the financial markets. Positive Money wants to see the power to create money to be used for something useful. It is an idea that’s already been mentioned by Sir Adair Turner in his recent speeches.
This letter asks the Secretary for State for Wales to give his support for “QE for Jobs” and raise it in debate wherever he can but particularly in Westminster.
Anyone in Wales interesting in supporting these Campaigns contact email@example.com.