Newsletter No. 22 - March
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This Progress Report on the campaign to put national
and international monetary reform on the G20 agenda
for 2nd April includes news about:
- the rising number of our petition signatories
- mainstream monetary reform and decentralised
alternatives e.g in Transition Towns
- moves by Russia and other
countries to put international monetary
reform on the agenda, with support
from the United Nations
- the possible consequences for Prime Minister
Brown and President Obama, if differences
among G20 countries result in failure to agree on
a concerted policy to deal with the global crisis,
and if this meeting is seen to be a flop, and
- what they should do about them.
1. The No
10 petition to the Prime Minister is now
supported by more than 400 signatories.
If you haven't already signed, please consider
signing. It only asks for the subject to
be discussed at this stage. It is quick and
easy to sign. Please tell anyone
else about it who may be interested, including
any networks you belong to.
If you have signed, please check
to see that your name is actually on the list of signatories. We know of people
who think they have signed, but who must have failed
to complete the confirming stage.
If you find that your name isn't there and should be,
please sign up again and then make
sure you click on the link in the confirmation email that the Number 10
website will send you. Only once
you have done this will your name appear on the petition.
NB. For immediate practical
purposes the deadline is 30th March, not
30th April as the petition states. So there
are only a few days left. But signatures
after 30 March will still be valuable for supporting
follow-up action by G20 governments after their 2nd
2. The important link between mainstream monetary
reform and complementary local currencies, local banks,
I was very pleased to be interviewed on the phone by
Marian Farrell of Transition Derry (http://transitionderry.ning.com)
on 11 March. The interview can be heard at www.jamesrobertson.com/videoandaudio.htm
interview was about the need
for mainstream monetary reform, what it would involve,
and why it is important for local monetary, financial
and economic decentralisation in Transition Towns like Derry and other places aiming
for local sustainability.
This prompts a comment about the wider context.
The aim, after this G20 Summit,
must be to help to transform the world's money system
into a multilevel system - international, national and local - primarily
designed to serve the public interest but also allowing
groups of people and businesses to develop their own
systems of exchange between their members - like LETSystems.
These local community currencies like Time Dollars,
Ithaca Hours, LETS, Chiemgauers and others already existing
in many countries - together with new local community
banks, credit unions, investment funds, etc - can
make an essential contribution to financial and economic
decentralisation and self-reliance on a greater scale
than exists today.
For a vision of this, see www.neweconomics.org/gen/iouk100309.aspx.
Decentralisation and self-reliance
can become a real possibility once mainstream
monetary reform has freed us from depending on a public
money supply created by banks as debt. If the banks
are allowed to keep that power, they will obviously do
what they can to limit the development
of local competitors.
other words they will use
their power to keep us as dependent as they can
on paying and being paid in the national currency for our purchases, earnings,
pensions, benefits, etc. But, if the
nationalised central bank has been given responsibility for creating the national money
supply in the public interest, it
will not have that reason to prevent us committing
ourselves increasingly to decentralised alternatives.
Some well-intentioned advocates
of local currencies oppose the proposal to transfer
the creation of national money supply to a central
bank which is democratically
accountable to parliament and people, and to deprive
the banks of their unaccountable power.
They think that
that would transfer too much power to government, and
suppose that just by deciding to use decentralised
currencies and local banks ourselves we could painlessly
erode the power of the banks. The
banks love that idea!
3. International monetary reform
SHOULD be on the G20 Agenda. Russia says so. So does
China. So do UN advisers.
A head of steam is now building
up on international monetary reform.
Detailed Russian proposals for
the G20 meeting have now been published - www.euractiv.com/en/euro/russia-reaches-eu-ahead-g20-summit/article-180389.
A ten-page paper - www.kremlin.ru/eng/text/docs/2009/03/
includes the proposal to consider the "Introduction
of a supra-national reserve currency to be issued by
international financial institutions. It seems
appropriate to consider the role of IMF in this process
and to review the feasibility of and the need for measures
to ensure the recognition of SDRs [special drawing rights]
as a "supra-reserve" currency by the whole
China yesterday proposed replacing
the US dollar as the international reserve currency with
a new global system. The goal would be to create a
reserve currency “that is disconnected from individual
nations and is able to remain stable in the long run,
thus removing the inherent deficiencies caused by using
credit-based national currencies”. The Chinese
central bank Governor acknowledged a debt to John Maynard
Keynes in the 1940s.
See - www.ft.com/cms/s/0/7851925a-17a2-11de-8c9d-0000779fd2ac.html.
A U.N. panel will recommend
this week that the world should ditch the dollar as its
reserve currency in favour of a shared basket of currencies,
a member of the panel said on Wednesday, adding to pressure
on the dollar. The proposal is to create something
like the old Ecu, or European currency unit - www.reuters.com/article/newsOne/idUSTRE52H2CY20090318.
Comment. International acceptance
of the idea of a genuinely international supply of
money created by an international agency,
rather than continuing to rely on the currency of
one self-interested nation, will have an additional
significance beyond itself.
It will help
more people to see that a corresponding reform is
needed at the national level - to replace
a money supply created by a self-interested group
of profit-making banks with a money supply created
by a public agency in the public interest.
4. Could the G20 meeting be a serious failure?
If so, what then?
It is becoming clear that differences between important
groups of participants will probably prevent
the 2nd April meeting agreeing on a concerted global
strategy to deal with the deepening world financial
and economic crisis. The spin doctors may not be able
to hide that.
So what will it mean for the two leading characters
in the drama?
Gordon Brown, chairman of the meeting
and the only current political leader with clear responsibility for
the credit boom, will now
be blamed for failing to save the world from
its disastrous consequences. The writing on the
wall will be horribly clear to him. His political
career may be over, his historical reputation a tragi-comical
story of hubris and nemesis. But he has a possible escape
Barack Obama's problem, though not
so obviously terminal, is also very serious.
He is under growing pressure to justify the scale of
his recovery programme at home. See www.reuters.com/article/newsOne
His initial poll ratings are falling because he cannot
prevent arrogant bankers in failed banks from diverting
American taxpayers' bail-out money into bonuses for failure.
The most telling criticism is that, although he is an
outstanding rhetorician, it is action not words
that count. This crisis could badly damage his presidential
The same escape route is open to him
as to Gordon Brown. It is, of course, to initiate
serious study of the need for and feasibility of monetary
Their explanation for this volte-face could
be on the following lines.
(1) The deepening crisis calls
for every possible solution to be examined carefully.
The practicalities of monetary reform have been
sufficiently explored in both the US and UK for
our advisers to examine their feasibility, and
not to reject them with knee-jerk conventional
(2) The debt burden on our future created
by the enormous and still growing programmes of financial
help necessary to restore the ability of the banks to
provide our public money supply will continue to be met
with increasing opposition.
(3) Justified public anger will
continue to grow at the banks' behaviour over
the credit crunch that has created the present global
crisis. It includes the banks' failure to lend the
money provided by taxpayers for that
and their diversion of it into outrageously
high pensions and bonuses to bankers responsible for
the crisis. Anger at their arrogance continues
to be fuelled by growing evidence of bankers'
complicity in schemes to defraud the taxman
and the public - and
evidence that the whole crisis has been caused by a
culture of complicity too deep-seated to be eradicated – see www.spiegel.de/
(4) "Quantitative easing" involving
bank directly creating new money to add
to the money supply has been accepted, and could
be a step toward a new future. See Item
4 in the last newsletter.
The political advantage to the
President and Prime Minster of announcing
that they are having this change of course seriously
examined could be great.
It would wrongfoot opposition
politicians in both countries, none of whom have convincing
alternative policies to deal with the present global
and national emergencies. To capture that advantage
they would have to announce it quickly enough to preempt
the others mentioning it publicly before them.
It should be an attractive idea
for the President.
He is steeped in the wisdom of the US founding fathers,
and Jefferson, Madison, and Lincoln all opposed giving "the
money power" to the bankers. He will know too that
Woodrow Wilson wrote a few years after signing the 1913
Federal Reserve Act: “I have unwittingly ruined
my country …" by handing it over to the bankers.
How does the Prime Minister see
the challenge? Did
he learn during his childhood in Scotland, as I did,
the words of the Earl of Montrose in the 1640s, and may
he be remembering them now?
"He either fears his
fate too much,
Or his deserts
Who dares not put it to the touch,
To win or lose it
What will history say about these
two men? Will it
present them as great statesmen, who liberated humankind
from subservience to bankers? Or
as disappointing politicians who failed to live up to
their early promise?
24th March, 2009