Newsletter No. 24 - June 2009
Links to other Newsletters can be found here.
1. Current UK Background
2. Another Book Now on Website
3. Yes! Magazine - Summer 2009
4. Book Reviews
(2) Ethical Prospects: Economy, Society
by Laszlo Zsolnai (ed)
(3) The End of Money and the Future of
(4) Money Matters:
Putting the Eco into Economics
5. The 'Sandbox Syndrome'
6. Some URL's Worth
This newsletter touches on many aspects of money. I
would like to emphasise two important points concerning
the need for realism about the exercise of power.
The first is that our leaders will only be empowered
to put through the necessary changes in the present money
system against the opposition of powerful defenders of
the status quo, if we
compel our leaders to make the changes. See 4(1), paragraph 3, below.
The second is that, as so often, our
approach needs to be based on both/and, not either/or.
It is not a question whether
to support decentralised monetary innovation against
mainstream monetary reform, or vice versa. Both are essential.
of money and finance will be an essential part of the
world's economic future, everywhere and at every level.
Mainstream reform will be an essential prerequisite to
decentralised monetary and financial innovation on any
significant scale. See 4(3), 4(4) and 5 below.
CURRENT UK BACKGROUND
'Greedy Members of Parliament' have temporarily
pushed 'greedy bankers' out of the headlines.
After the elections last week for the European Parliament
and local councils, the media are still largely dominated
by short-term political questions such as the prospects
for the Prime Minister and political parties, the next
general election, and whether we need politicians to
be more independent of the party line.
The scandal about MPs' expenses has been seen as a
possible opportunity to deal with more 'fundamental
constitutional questions'. But those
tend to be the conventional constitutional issues -
voting systems, House of Lords reform, citizen's juries,
citizens' rights to 'recall' their MPs etc.
Inward-looking politicians and political commentators
don't see that there are wider
questions of constitutional significance too, e.g. how to limit the financial influence
of big business and finance on public policy, or who
creates the public money supply and who decided that
commercial banks should create it as profit-making debt.
Heather Brooke's successful use of the Freedom of Information
Act to expose the scandal of MPs' expenses sends a message
of hope. Could the Act be used
to expose some of those other scandals too?
2. ANOTHER BOOK NOW ON THE WEBSITE
The History of Money: From Its Origins to Our
Time is the English text (www.jamesrobertson.com/books.htm#history)
of my Une Histoire de L'Argent:
Des origines à nos jours, Autrement, Paris
2007 - www.autrement.com/ouvrages.php?ouv=2746710306.
This short 'Junior Histoire' is about how
money began, how it has evolved to the present day, what
it has enabled humans to achieve, why so many people
in the world today suffer from the way it works, how
it may develop further, and how young people today might
want it to develop. I am grateful to Autrement for
permission to make it available here.
3. YES! MAGAZINE, SUMMER 2009, ISSUE 50
David Korten writes
an introduction to this 64-page
issue on The New Economy
Starts Here: Why This Crisis May be Our Best Chance. It
follows up his book at 4(1) below.
My article in this issue on Money
from Nothing: Supplying money should be a public service,
not a cash cow for banks is at www.yesmagazine.org/
For more about Yes! magazine see www.yesmagazine.org.
4. FOUR BOOK REVIEWS
(1) David Korten, AGENDA
FOR A NEW ECONOMY: From Phantom Wealth to Real Wealth, Berrett-Kohler, San Francisco,
2009, paperback, 196pp.
A splendid book. Although written
for American readers, it is very relevant to other 'developed'
countries and the world as a whole. "We
will need to change virtually every aspect of how we
structure and manage our economies. Instead
of maximising the rate at which we turn useful resources
into toxic trash, we will need to optimise the health
and quantity of our stocks of real wealth" (p116).
At its core is a 12-point agenda
for a real-wealth economy, including:
Redirecting the focus of economic policy from
growing phantom wealth to growing real wealth - by replacing
financial indicators like GDP with indicators
of real well-being as measures of economic success
and failure. As Korten points out, this is inseparably
linked with point (12) below.
(4) Reclaiming the corporate charter, to specify and
monitor the public purpose and performance of business
(6) Rebuilding communities with a goal of achieving
self-reliance in meeting local needs.
(7) Adopting policies that favour human-scale businesses
owned by local stake-holders.
(9) Using tax and income policies to support equitable
distribution of wealth and income.
He notes the two following points as "arguably
the most important":
(11) Restructuring financial services to serve the
real, not the phantom, economy; and
(12) Transferring to the federal government the responsibility
for issuing money. (As Korten says, this is linked with
(1) above because, without continuing growth of its money
supply and GDP, an economy whose money is based on debt
is bound to collapse.)
The book emphasises President Obama's opportunity to
preside over this historic revolution. But the
inspiring final chapter, When
the people lead, the leaders will follow, has a message
for us all. It recognises
that to enable Obama to succeed, he
will have to "be
confronted with a popular demand from below too powerful
to be ignored".
The fact is that, only if we find
ways of compelling our leaders to lead, will they be
empowered against defenders of the status quo to
tackle the fundamental changes necessary for human
survival and breakthrough to a new age in world history.
P.S. The next edition of this short, readable book
should, in my view, include proposals on the future of
the international money system. If left unreformed, it
will frustrate the book's vision of the future.
(2) Laszlo Zsolnai (ed), ETHICAL
PROSPECTS: Economy, Society, and Environment, Springer
Science-Business Media BV, 2009, hardcover, 309pp.
This book is about ideas and
initiatives that lead toward responsible business practices, policies for the
common good and ecological sustainability. I warmly recommend
it, especially to readers with access to academic or
other institutions that can afford to buy it.
Contributions by 27 practitioners and scholars from
Europe, America and Asia "represent a diversity
of fields including business ethics, philosophy, organizational
science, systems theory, finance, management, economics,
political science, and ecology". Its chapter headings
include The Good Company, Value
Creation as the Foundation of Economics, Buddhist
Economics for Business, and Ethical
My contribution explains why business
ethics cannot avoid the question: "Can we resolve
the present mismatch between money values and ethical
values by reforming the way the worldwide money system
and answers "Yes, we can and must". (I will
e-mail a copy as a pdf file to anyone who asks me for
"Robertson chapter in Ethical
The Debate in Part 4 of the book corrects Bill Clinton's
slogan "It's the economy, stupid". The
economy is only a means to achieving a society's ends.
We need to get our politicians, business leaders, and
other 'professionals' to
see that "it's NOT the economy, stupid, it's the
I hope Laszlo Zsolnai's collection
of articles here will help to accelerate our understanding
of money not as things, but as a system of interconnected
that it generates a practical calculus of value that
strongly motivates the behaviour and lives of almost
everyone in the world; and that our species survival
will depend on our reforming it to reconcile the values
it imposes on us with the values most
of us hold.
(3) Thomas Greco, THE
END OF MONEY and the FUTURE OF CIVILIZATION,
Chelsea Green, Vermont, 2009, paperback, 268 pp.
Tom Greco has been for many years
an acknowledged champion of free, decentralised, community
currencies. I enthusiastically
recommend the second half of his book to anyone who wants
to know more about the case for them and the practicalities
of setting them up.
I also applaud the first hundred pages. They offer
a devastating criticism of the present "monopolistic
control over credit, exercised through a banking cartel
armed with government-granted privilege" which "allows
wealth to be extracted from producer clients and, despite
the trappings of democracy, the control of governments
to be maintained in the hands of a few. Credit is allocated
on a biased basis to favoured clients, including central
governments, which distorts both the system of economic
rewards and the exercise of political power".
I agree wholeheartedly with that diagnosis of the problem.
It is when we come to what we should do about it that
I question Tom Greco's realism. He dismisses as unrealistic the
aim of transferring to public agencies the function of
issuing the public money supply debt-free in the public
interest under effective democratic control at national
and international levels. He assumes that national
political power and global financial interests will successfully
combine to stop that happening.
But it is surely even more unrealistic
to hope that that problem can be by-passed by persuading
people to drop out of the unreformed mainstream money
rely on "private initiative and the creative application
of new technologies and methods" instead. Can pioneers
of the new local community currencies develop them quickly
and widely enough to liberate millions, let alone billions,
of us from our present dependence on the unreformed big
banks and big governments to provide for our money needs?
If ever a sizeable number of people did look like succeeding
in that, the unreformed big banks and governments would
surely combine to stamp them out, as they stopped the
growth of complementary currencies in the Great Depression
of the 1930s.
A careful reading of the book
encourages me to hope that Greco may be shifting from
his earlier views on this point. In Chapter
19 on The Role of Governments
in Establishing Economic and Financial Stability he
does, in fact, set aside his selective pessimism about
mainstream monetary reform. He advocates legislation
to achieve what are many of its aims. He also hopes not
to drive a divisive wedge between would-be allies, but
to promote a deeper understanding between 'reformers'
and 'transformers' in pursuing a common fundamental goal
- 'empowerment of people' (p110).
The 'both/and' nature of what
we need to do is clear:
we need both to support complementary
currencies and economic decentralisation; and we
need to recognise that that won't happen without either
mainstream monetary reconstruction or the almost total
collapse of human society in its present form.
P.S. Please also see Item
(4) David Boyle, MONEY
MATTERS: Putting the eco into economics - global
crisis and local solutions, Alastair
Sawday Publishing, Bristol, UK, paperback, 2009.
This handy new book on money by David Boyle provides
an excellent guided tour, covering almost
every aspect of the money system.
It contains eight Sections - on Metal
Money, Information Money, Measuring Money, Debt Money,
Mad Money, Local Money, DIY Money and Spiritual Money.
Each Section contains between eight and fifteen two-page,
bite-sized chunks, eg on 'Gold: The barbarous
relic', 'The lunacy of GDP: Why money isn't
everything', 'Great Crashes 5: the 2008 crash' and 'Greed
therapy: The basis of the problem'.
As Charles Middleton of Triodos Bank says
in his Preface, it explains clearly, concisely and entertainingly
what Boyle thinks has gone wrong with our banking system
and financial institutions.
I warmly recommend the book,
but with a serious reservation similar to the
one on the book immediately above.
Its fatalistic conclusion - that
the faults of today's dysfunctional money system lie
much deeper than it is possible for us to change - is
very disappointing. For more, see Item 5.
5. THE 'SANDBOX SYNDROME'
This is relevant to the books by Tom Greco and David
Boyle reviewed at 4(3) and 4(4) above.
The 'Sandbox', as Michael
Marien described it in 1983, is "an enclosed area
where children safely play, while adults carry on undisturbed
in their usual wicked ways. Two complementary forces
promote this condition: adults place children in the
sandbox to get rid of them, and children volunteer to
play there because it is fun". See the sixth paragraph
In the context of the two books under review, the
adults who carry on undisturbed in their usual wicked
ways are the leading people in big banks and big governments.
They are delighted to see their children - fellow citizens
- peacefully distracted and occupied in the sandbox,
not taking an interest in their wicked ways. They may
even give the children's leaders some pocket money from
time to time to keep the other children busy there, safely
out of mischief!
Of course it's true that the money values generated
by the way the mainstream money system now works are
in conflict with our non-money, ethical, emotional, aesthetic,
spiritual and survival values. But that
is a mismatch we must try to put right - as noted under book (2) above.
To ignore it, because it's "a fundamental problem" and
an "ancient mismatch between money and value",
is like accepting Mrs Thatcher's TINA - "there is
no alternative". The way the money system now works
has not been decreed by God or Nature. It
is a purely human construct,
open to us to change - given the necessary
understanding and will.
Many people are capable and intelligent
- understand how the development of money has
been biased, as summarised for example at www.jamesrobertson.com/books.htm
- realise that the calculus of money values we
have inherited from it has no foundation in objective
- understand, when its mechanics are explained
to us, how its present workings produce perverse
- see, therefore, how it needs to be reformed
- systemically, as a system of systems, not with
solutions that are supposed to solve everything'.
That will enable more of us to recognise its reforms
as the necessary and only way to free ourselves and others
from its domination, and allow us to develop decentralised
alternatives that it won't be able to stamp out - and
then get down to the task of reforming it.
6. SOME URL's WORTH VISITING
IMPORTANT for US readers
Land Value Tax and Banking Reform
Ethical and Sustainable Banking
"There is no positive economics, but only normative
End of Economic Growth and Switch to Degrowth
Download the final declaration
8th June 2009