By Marshall Bridge. The proposed cuts have barely started as yet, but when they do start to bite I fear we will see real hunger and privation throughout the land.
The cuts mentioned in recent articles such as immigration, EU membership and the rest, useful as they would be if implemented, would still leave a large shortfall in the deficit.
What we really need is to get down to the basic problem which was not caused by chronic overspending as some recent articles claim, but by chronic over borrowing – a subtle but important difference. This in turn gave us our chronic debt problem and the resultant cuts.
If National governments issued their own currencies debt free and in line with GDP, this problem would not arise.
We cannot expect respite from the current Westminster politicians, although a few MP’s of all parties are now monetary reformers, but I still believe that effective monetary reform at National level will have to wait until we get Nationalists MP’s into Parliament.
Reform at the local level may be a more immediate proposition. Most Nationalist will remember (though not from personal experience) how the Guernsey Islanders overcame the privations of the deflation following the Napoleonic Wars by issuing their own local currency to finance essential public works. The small town of Worgl in Austria introduced a local scrip during the 1930’s depression which completely eliminated unemployment locally, while it remained very high throughout the rest of the country.
Local currencies such as LETS and the Totnes Pound are well known, but my own favourite is the Council Tax Voucher scheme. Here is how such a scheme would work:- Assume that Central Government cut the 2012 grant to your local council by £20 million. The council would simply issue vouchers to the same value and gradually introduce them into the local economy.
The vouchers would be issued as part payment of council staff wages, or as part payment to local businesses for services rendered and I believe they would soon be accepted as a local currency. They would also be redeemable at any time as payment of council tax or business rate. The scheme would not be inflationary because the voucher issue would simply replace the government grant so there would be no overall increase in the money supply, nor would it add to the councils burden of debt.
If this voucher scheme was widely accepted by local councils, the government cuts would be largely circumvented with huge benefit to all of us.
I do realise that there may be problems regarding the legality of such a scheme, but a nationally known food outlet issues vouchers, so why not local councils?
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because,.. you’d be competing with the banks and the banks wouldn’t stand for that.
I would be disappointed indeed jamie if the banks liked this idea, but this is no reason to shy away.
It is generally accepted now, even by economist of the old school that the economy needs money, but it cannot afford the debt that always accompanies money in our debt based economy. Every Pound created by the banking system which furnishes us with 97% of our money supply is created as debt.
The beauty of this voucher scheme is that it delivers the money to maintain all the current local services but without the debt. Better still, the banks will be unable to use these vouchers as a fractional reserve and “leverage them up” thus causing inflation as they do with our National currency.
Healing them? The debt forced on people, admittedly with considerable toleration on their part, seems to mean that that every person would need to give something like ten or twenty years’ work exclusively to paying off their share of debt. (This is a guess based on amount per head and tax and interest rates; the productivity is a huge unknown). It may simply be impossible without something like forced labour. It’s a subject that needs quantification….
You are right Revisionist, but this voucher scheme is just one facet of monetary reform which will ammeliorate a specific problem (the cuts).
For a more comrehensive picture visit:- positivemoney.org.uk
We should also put a compulsory purchase order on the PFI hospitals. The last I remember we were paying the banks 17% per anum on those.
This article proposes a neat solution to the government cuts at local level and exposes the basic problem of our debt based economy. Under the present monetary system, the government only has two methods of bringing money into the economy. It can borrow at interest from the banking system and increase the already un-repayable National Debt or it can raise the level of taxation. The government made the decision to reduce its debt obligations. Now we are witnessing the job losses etc which are directly attributable to that government decision. The debt based system itself is inherently flawed. It cannot be fixed and the economic experts committed as they are to maintaining the status quo, now appear bereft of any real and long term solution.
The only long term solution to Britain’s economic problems lies in returning to government, the long lost prerogative of monetary creation. To do this, the banks must be stopped from earning themselves huge profits by creating the nation’s money supply out of thin air.
This could be done by making small but important changes to the legislation of the Bank Charter Act of 1844 which has not been updated and would remove the ability of the banks to create ‘electronic or digital’ money.
These changes would return the sovereign right of monetary creation to government and allow an honest debt free money system to operate on behalf of the British people.
To circumvent the devastating cuts now hitting local authorities by advocating the Council Tax Voucher Scheme is a great idea which will require people who are now feeling the negative impacts of the present boom and bust economic cycles to think outside the restrictive parameters of fossilised ‘orthodox economics’ if they really are serious about reviving Britain’s economy.