For historic reasons that are rooted in the monopolistic management of money by commercial and central banks, the world community lacks the resources it needs to appropriately address humanity’s mushrooming social and ecological crisis. To tackle this crisis, this bank monopoly must be broken.
It goes without saying that central banks are public sector extensions of the private, corporate, commercial banking industry. They are tasked with meeting the expanding demand for money, and since money these days (though cash convertible) exists predominately as balances in electronic accounts, the central banks achieve expansion of the money supply by allowing commercial banks to expand credit lines to business customers and private clients. The banks make the interest, and they collect collateral when loans go bad. If the banks, themselves, go bad, the central bank steps in to restore financial stability.
Banks lend money in the private, for-profit economy, which is an important commercial service, but such credit lines do not support expansion of the non-profit economy of NGOs that (along with small- and micro-business development) is now key to successful social and ecological problem-solving. Because the world’s crisis is intensifying and requires massive investments in human capital and infrastructure, the next social contract – between people and corporations – must have a means of ensuring sustained NGO and small-business investment. Without this, social and ecological disaster is unavoidable.
While commercial banks create money in the form of credit accounts, they are not the only institutions able to take on the job. To effectively and confidently issue money on account, an entity must have wide public trust and a transparent revenue stream. For instance, if a government wanted to take business away from banks, it could – on the strength of its prominence and tax revenue streams – issue credit directly, without bank participation. In various ways, some governments already do. Beyond governments, other entities also could do the job. For instance, prominent economists have proposed that the International Monetary Fund (IMF) issue a “reserve currency” based on the weighted value of the major currencies in today’s global market. Even a private business can issue a currency, as Bitcoin has been attempting.
Any body that holds the confidence of commercial networks, investors, and depositors could issue money, possibly at interest rates designed to generate no profit. We propose to establish such a body – the Global Problem-Solving Authority (GPSA) – to open a market of credit lines to NGOs (as well as small- and micro-businesses) for the express public purpose of achieving full employment through worldwide social and ecological problem-solving. In the coming era, the service providers of the mission-driven NGO economy, paid in Commons Currency, will be the chief engines of economic growth.
To buttress this effort financially and to build the networks necessary for transparent, popular oversight of its programs in the multigenerational long run, the GPSA must have a permanent revenue stream from corporate commerce in the form of a fee on all corporate transactions in the global banking system, something on the order of one trillion dollars annually. With this sustained revenue as its base – and with the support of central and commercial banks that is the consequence of their decision to collect and transmit the fee – the GPSA can begin a powerful parry of today’s dangerous social and ecological trends and unfold a campaign to correct the damage, a campaign that involves everyone because it depends on everyone and everyone benefits, beginning with this new social contract. Put willing people to work improving their lives, strengthening their communities, building infrastructure and restoring their environment, and we will have the basis for a sustainable, secure and prosperous future for all.
The landscape of contemporary economic commentary is littered with champions of a “bank tax,” a “transactions tax,” a “Tobin Tax,” a “Robin Hood Tax,” “Modern Monetary Theory,” and a new “global reserve currency,” but what all discussions lack is a means of genuine, popular control and administration. Without taking the reality of corporate control of governments into account, any of these reforms will inure to the benefit of corporate commercial banks, not humanity as a whole. That is not a new social contract. Our fate cannot be left to the whims, fears, suspicions and power of the banks’ monopoly of money. We, the World's People, must have our own problem-solving revenue stream off the commerce of our civilization and our planet’s natural resources. We must open our own credit lines to the NGOs that serve us. This social contract must mark out and enforce the dominion of human life over corporate “life.”
To establish the kind of financial utility that people actually need, we need to build a global network capable of leading orchestrated, coordinated, powerful actions against commercial and central banks and for corporate accountability. Once we demonstrate the capacity for this kind of direct action, the banks will be forced to enter negotiations over the next social contract and the role that the GPSA will play in enforcing and implementing its civilization-saving agenda.
Through GPS Action to force commercial and central banks to agree to terms for the next social contract, we will form a network that, itself, will be the basis of this new GPSA.