[P2P-F] money as debt. 3

Sun Oct 16 17:19:47 CEST 2011

Dear Tadit,

please note that when I spoke of monetary pluralism it explicitely excludes
private for-profit players, we are talking about local communities or
virtual communities. Of course, they should be fully accountable to the
public.

can you explain what you mean exactly by debt-free ? my understanding of
LETS and such was that you get the money by performing a task, not by
lending it ?

in your scenario, would the sovereign just 'give' the money? (basic income?)

Michel

On Sun, Oct 16, 2011 at 10:09 PM, <ideasinc at ee.net> wrote:

> Michel,
>
> I will need to reply to this in chunks or as issues to a volume. On Keen,
> and thereby MMT, the counter point is MMT. With Keen you are seeing the
> analytical side of the econometrics and his approach is to a strong degree
> about his use of the methodologies to identify dys-functional financial and
> fiscal policies. The simple identification that the finance sector doe not
> have a neutral effect/voice in either the political or economic commons. It
> is by the monitoring these sort of metrics that we can choose principles and
> practices to move us toward a different set of objectives assuming that the
> ends are privatized as in toward sustainable economics.
>
> The current set of pretexts of neo-classical/privatization/**enclosure of
> the currency and thereby our economy are continuing to include more oiled
> fictions as rhetoric to support appearance. At one level the more generic
> difference is between positivist sciencism (ie faith based) and dialectical
> science as a socializing process. Keen's focus and methodology is rigorously
> and passionately mathematical. I don't recall him speaking much toward the
> alternative policy discourse which had Lerner and Lowe. Keen is describing
> the means and mechanisms to set different objectives. Perhaps implicit is
> that a takeaway from Keen is that the particular varieties of dys-function
> relative to the public interests and high functionality relative to a more
> selected profile and influence, the .01% . The instability is intentional
> not accidental, as in the US Trader recently and eloquently described for
> the BBC his clients make "money" on the way up and on the way down. In fact
> there are massive incentives to promote economic instability.
>
>
>
> On Sun, 16 Oct 2011 09:07:30 -0400, Michel Bauwens <
> michel at p2pfoundation.net> wrote:
>
>  This is a difficult debate for me Tadit, as I have never truly studied
>> MMT,
>> and what kind of money is best.
>>
>> I'd like to posit some general principles as to what a commons/p2p
>> friendly
>> policy would be ...
>>
>> - first of all, I think monetary freedom is important, which for me means
>> that next to sovereign money that is governed by the collective, and we
>> need
>> at least a  national and global level, we also must accept
>> community-driven
>> 'socially sovereign' money ... so repression of successful local money by
>> the state is not acceptable
>>
>
>
> Tadit: Here again comes my story about the "Free Banking" period in the US,
> which had relatively speaking the highest levels of fraud and embezzlement
> as US history up until about 2000. The front side of the story is that the
> Second National Bank of the US was as big a fraud as was the First National
> Bank of the US. Pres. Thomas Jefferson allowed the charter of the First
> National Bank of the US, which caused a very angry visit by Mayer Amschel
> Rothschild to the British War Department, which then became the US British
> war of 1812, which oddly seemed to be more about burning down the national
> capital as a symbolic act, than the occupation of territory. Anyway Andrew
> Jacksonbecame convinced that the people behind the Second US National bank
> were frauds and thieves due to evidence of illegal activities. The other
> side of the process is that the bank was buying up politicians at a rapid
> rate, such his veto on any renewal of that charter could be over-ruled by
> congress given enough unregulated campaign funding. What Jackson did to
> destroy the Second US National Bank was to move the funds of the US
> government to other banks. Beyond Jackson's anger at the Second US Bank, he
> was also a strong state's rights/local rule advocate. His solution was in
> effect to let each state to work out their own banking processes. This began
> what is known as the "Free Banking Era in US history from 1832 to 1860 the
> US as a sort of economic confederacy had over 7,000 local currencies,
> generally issued by local banks. The level of banking and currency fraud was
> enormous. In effect Jackson had a serious and legitimate problem with the
> practices of the Second National Bank of the US, but he proposed effectively
> the wrong solution, and it was in some large degree a "free market" bit
> deregulation which became a different major problem.
>
> The US Greenbacks and various currency sovereignty details were established
> and then later in Lincoln's administration the US Banking Acts of 1863 and
> 1864 established some national standards, and it also created more problems
> which lead to a different story.
>
> I have two main points relative to the proposal of local currencies. One
> major problem is the entire field has no standards of transparency or
> accountability. The second you are already familiar with the distinction
> between a sovereign fiat currency issued on the basis of debt(often masked
> as "credit" because is sounds more positive, but in the detail of practice
> it makes no difference between "Debt" and "Credit") and a privatized
> franchise to "print" money.
>
> Treating an exchange association as an LLC and as a cooperative has its
> advantages in part by familarity of the model, by member capitalization, by
> patronage rebates, by internal revolving loan funds, other forms of
> incubation, and more.
>
>
>
>
>
>> - money should be a commons, I'm not sure exactly what that means, but it
>> should not be subjected to speculation, and is a public utility that
>> should
>>
>
> Tadit: Speculation can be eliminated to a large degree at least formally
>
>  be protected from private misuse ...; how exactly can we make money into a
>> commons, that is an important question for me, in which I would like to be
>> educated ; instinctevely I'm against the private for-profit creation of
>> money as it is currently practiced
>>
>
> Tadit" IF and this is some degree a big IF, if the process of governance is
> not also controlled as a commons based democracy by performance, then it is
> unlikely that this will happen except by autonomous initiatives such as the
> CRX.   MMT/FF tends to relatively neutral and instrumental toward objectives
> defined with regard to democratic outcomes, not by an electoral system
> chained to a stacked deck of "legitimate" choices.
>
>
>
>> - third, money has a design, and that design should be a design that does
>> not permit excessive accumulation, nor require infinite growth
>>
>
> Tadit: money circulation and management does define money by how it can be
> used and controlled. The package of fictions related nominally legitimating
> the monetary defaults. Understanding reserve accounting how it is currently
> used is critical to how that process can be simply turned to the benefit of
> the commons and commoners in several ways
>
>
>> before encountering MMT, the people I listened to were:
>>
>> * Bernard Lietaer, because of his recognition of all the levels, and his
>> effort to have an answer for each level
>>
>
> Tadit: The notion of complementary currencies is all useful, and still
> Lietaer operates within a debt based standard. I am sure that the
> complementary innovations could also be implemented under a debt-free
> currency process.
>
>
>
>> * Thomas Greco, and his idea for local credit commons, based on the real
>> interactions of local players; weakness here is that it can't be applied
>> rapidly enough in national crisis situations
>>
>
> Tadit: For me this is an external process which can be worked in other
> ways. The CRX explicitly has the capacity to develop internal revolving loan
> funds either through the CRNs or through the accumulation of Federal Reserve
> Notes aka Dollars.There is no intrinsic positive to a debt based currency,
> imo.
>
>
>
>
>> and this is why I liked the approach of Ellen Brown, because of her
>> insistence, with many documented examples of the past, that
>> people-friendly
>> governments can issue money as a productive investment, and that it is not
>> inflationary in such circumstances
>>
>
> Tadit: Ellen Brown's argumentation is weak and her history is weak, but
> placing the proposal for state banking as utility banking with in the
> context of the needed monetary reform as recently suggested by Michael
> Hudson is completely agreeable as an element. Using the "success" or lack of
> offensive behavior in a state of less than 700,000 residents in total is not
> exactly a good reason to expect that the banking culture in NYC or
> Washington DC will change in the least. In fact it is likely that state
> banking in such places will have the character of the banking culture that
> we are generally blighted with.
>
>
>
>> to summarize:
>>
>> - a pluralist money system that can operate on local, regional, national,
>> and global levels, issued by either sovereign states or local or affinity
>> communities
>>
>> - conceived as a commons / public utility that cannot be manipulated by
>> private interests
>>
>> - designed in such a way that it does not create negative social and
>> natural
>> externalities (counter-example: bitcoin is socially sovereign but has the
>> wrong design)
>>
>> Perhaps if you have time one day, you could write about how you see money
>> as
>> a commons, and how MMT stacks up against these contemporary 'p2p' driven
>> demands
>>
>
> Tadit: it is something I have been thinking about. I know that there is a
> natural proclivity between the two domains. Perhaps what I have at the
> moment is that the MMT/FF can be applied in an autonomous fashion. On the
> negative social externalities these have to be addressed through practice,
> and this one reason I thread in the form of worker and consumer cooperatives
> as a more familiar model. I see these details to be fairly small bumps
> normal to establishing a self sustaining economic process.
>
>
>
>> One question for MMT, what kind of government would want to implement
>> this?
>>
>
> Tadit: It is intended to work in a range of democratic cultures. Let's turn
> this all upside down and shake it a bit. What we have now is effectively an
> MMT/FF process which is operating with an anti-democratic and even criminal
> agenda.
>
>
>
>> Michel
>>
>>
>>
>>

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