Latest News in the World of Complementary Currencies
Solidarity Sprint Tour Following up Dear friends we’ve met on our recent travels, and those we missed (and if we really missed you, like you don’t know about the Sprint, here’s some more info) – We invite all the people who are interested in being part of or supporting the growth of Mutual Aid Networks…
How do we change the rules for banking in favour of the people? Teach children how banks work. This was the last wish of Sue Hamill, the founder of Positive Money New Zealand. PM NZ is leading the charge in the case of The People vs. The Banks in New Zealand. Before Sue passed away, […]
My recent research into societal collapse (watch this space) lead me to John Michael Greer, who offered an uncommonly wise perspective, so I purchased this book to update myself on his post-peak oil thinking.
It describes progress as a ‘civil religion’ and examines how deeply ideas and more importantly assumptions about progress lie in our civilisation’s narrative compared, say to other civilisations which reified the past or the unchanging nature of things.
Greer explores Spengler’s work about civilisation lifecycles which have distinctive patterns particularly in their evolving philosophies, and identifies ours as past its peak, and ready for rationalism to give way to a second religiosity. Peak oil is a major driver in this – like many authors I’m finding Greer credits fossil fuels for almost all the growth of the last 200 years, and says that growth must end as energy extraction peaks.
The main theme of the book then is about the long term decline we are now entering and the gap between reality and the religion of progress. That hubris of policymakers is leading not only to waste, and of course needless suffering and death.
He memorably cited the optimism around fission research, saying that even if they could make it work the facilities would be far too expensive to be viable and that it is the assumption that all problems are solvable that means this field is still lavishly funded.
Towards the end he gave some hints about what decline means in real life. It means that the average business doesn’t make a profit, can’t pay back loans in full, and can’t pay rent. I was reminded of friends trying to run micro-enterprises unable to pay the rent on the shop- even though half the shops were empty.
Now I’m starting to think through – accepting decline would mean
- struggling to maintain infrastructure we have rather than building hi-tech high maintainance infrastructure
- not waiting for economic growth before we adapt to climate change.
- negative interest rates to reflect the degree of economic shrinkage
- romanticising of the days of easyjet, private transport, climate controlled housing, meat every meal etc.
- a dearth of new cultural movements, initiatives, businesses even new ideas
- greatly reduced research & new technologies.
And don’t forget folks this decline is only the backdrop to climate chaos!
I’ve always supported Basic Income (BI) in principle. It is probably the most direct possible strategy to address the perennial problems of poverty and inequality. It works by giving enough money to live to everyone, effectively putting a floor on poverty, and taking away the fear and want that drives people to underprice their labour. It is unconditionality makes it cheaper to administer than a normal social security system.
This week I learned that there have been plenty of trials, and they consistently demonstrate the above benefits in addition to others like empowering women (at least in India) and helping people to invest in their own livelihoods.
After a week of conversation as an outsider to the movement, I want to record here some other thoughts, which I hope may be of value.
1. The term:
It must have taken years of debate to settle on ‘Basic Income’ so maybe my thoughts on the matter are nothing new and too tardy. The term Basic Income does not express (to me) the intention that it should be enough to live on. Because the term ‘basic’ does not at all imply ‘sufficiency for living’ there is nothing to stop politicians issuing any paltry sum and calling it ‘Basic Income’. On the surface, it would be a victory but it could lead to conflict in the movement and bad public relations, especially if results were disappointing. I am reminded of what happened in microfinance, which was a fabulous idea for charitable lending to the poor which became something entirely different and less effective as it scaled and had to become commercially viable. Also instead of ‘income’ I much prefer ‘dividend’, because it implies the entitlement that the rich, (who most need convincing about these ideas) understand so well. Dividend also dovetails with the commons discourse, in which so much of the world is enclosed commons which in truth belong to everyone. So language like a social dividend, or a living income, would seem much stronger. So saying, we are now in a post-growth era a zero-sum economy, and dividends could take on a different connotation.
2. BIEN Identity & purpose
In my time as a complementary currency activist, I have visited several other movements, most of whom are hardly referencing each other. This silo-ing is an easy trap to fall into, especially when the movement is funded to focus on its core issue, and especially when the arguments are technical or complex. Basic income should not build a tribe of fans and advocates for a single universal policy, but about building expertise and disseminating it throughout the social movements as a strategic option for them. BIEN should be a hub of expertise not a force in its own right. I was glad to see some politicians in the congress, and I wasn’t the only complementary currency practitioner, but I would have liked to have seen more people around from the trades union, think tanks, monetary reform, commons, and especially from the movements du jour, Gillets Jaune, Extinction Rebellion and Friday’s for Future. BIEN is conspicuously absent from this list of grassroots movements meeting in Iceland next week.
3. More focus on economics
It seems to me that more formal economists should be involved in costing BI and anticipating the economic (and social) benefits. Economics is needed to justify (though not to determine, I am cynical to say) almost all political decisions today. I would have liked to learn more about the economic effects of increased spending by the poor, like GDP and sales taxes, about how the richest would pay most of their BI straight back into a progressive tax system, and about the longitudinal social benefits when the poor eat better, sleep better and live less stressfully. This is sometimes quantified as ‘social value’ – another expression I did not hear this week. I heard some discussion about how BI is funded, but nothing about modern monetary theory (MMT). Bernie Sanders just announced at $17trn Green New Deal (GND) manifesto pledge which would be funded I think by MMT. Are any basic income advocates advocating MMT?
4. Climate change
I did not attend all the sessions, but I saw almost no mention made of climate change. The last 18 months have seen an upsurge of concern about the rapidity and the magnitude of climate change and with it much attention to the psychological and social consequences. The question of how basic income – as opposed to other policies will help with adaptation to climate change should be considered urgent.
The big picture
My largest concern is that BI could be widely implemented in a relatively short time, but because the economy itself is constantly changing and/or because the economy will change in response to BI, it could soon stop working as intended. I read one article on this a while ago, saying that if everyone’s income increased, rents (land rents) would increase commensurately, canceling out the benefit. Upon examination, this turns out to be a whole slew of arguments showing how naive it could be to think we can change the economy with a single intervention. To prevent rent-inflation, they could, of course, be capped, but inflation could also occur in other sectors like utilities, or food, and preventing all that would cause the neoliberals in charge will balk at the idea of such a heavily planned economy.
In some ways, the BI is not very radical, which is part of its appeal of course. Some would argue that it is just a tweak to capitalism, similar to the welfare state, and that capitalism has fundamental problems and must be replaced. The focus on basic income as the solution could leave little room for more radical ideas or different approaches. What if, for example, governments were prevailed upon to ensure that no one in their borders needed to be malnourished or cold or ill alone. This is much more concrete than BI and would deliver similar benefits. it could be achieved using BI or other strategies in keeping with the prevailing ideology.
BI is a strategy, not the goal, a means not an end. It may not be the best means for every country. I support BI but it seems it is a single strategy amongst many; implementing it will not be the end of the sempiternal struggle between capital and labour, just a step in the right direction.
Ons Geld advocates the introduction of a personal safe account. Safe accounts are held at a public depository and accessed via a payment environment of choice.The market provides payment convenience and the government secures stability. The safe account paves the way for liberalisation of lending and implementation of digital cash. This article explains the safe account and places it in the context of both the current monetary system and digital […]
At the Basic Income Earth Network 2019 Congress I had a chat with Kang Nam Hoon, designer of the Young Person’s Basic Income in Geonggi, in the Suwon province of South Korea. This Basic Income is not paid in the national currency, won, but in a token issued by the regional government and 100% backed by won. Each young person is given a plastic card, and their balance is topped up every month. All the shops can accept the currency using their existing payment infrastructure (which sounds a bit smarter than our Western systems) being able to handle national currencies and other kinds of units. ONLY local businesses are allowed to redeem it for won.
The first order effect, apart from supporting young people trapped by recession and technological unemployment, is that trade in local shops has been shown to have increased by 25%, but he also spoke of a multiplier effect. In Geonggi with its digital currency, the multiplier is small, but a similar project in a neighbouring province uses paper notes, which do circulate further.
I had the impression there weren’t a lot of economists in the conference because the multiplier effect was hardly ever mentioned. Just the act of giving money to the poor (instead of say, the too big to fail banks), all but ensures the money will circulate, increasing GDP employment and tax revenue. I wonder if economists don’t see the benefits of Basic Income as clearly as other social scientists?
Here’s a written interview with the governor of Suwon.
Hello all, I’m writing from Detroit, our 3rd-to-last stop on our month-plus-long Solidarity Sprint. Learn all about it as we start compiling our notes, photos, and reflections on this massive experience. Over the last month, we’ve visited, worked, and had fun with folks in mutual aid projects in St. Louis, Carbondale IL, Western North Carolina,…
The post Support our Solidarity Sprint! and learn about it at our Madison meetup 9/27. appeared first on Mutual Aid Networks.
The discussion on a sovereign money reform is gaining momentum and concrete answers to the questions on how to design a new monetary authority are increasingly demanded: What goals are being pursued? According to which principles and how should the monetary authority create money? How can the right balance between independence, transparency and accountability be […]