The EU and the New Economy
“We cannot manage the scale, complexity and dynamics of the 21st Century with the tools of the 20th. We are at a turning point in world history where new ideas, new values, new strategies and new institutional arrangements are needed. We have learned that we cannot rely solely on “the magic of the market place.” Nor can we rely on technological solutions to save us from ourselves. We know that business as usual will lead to disaster. We must find the vision, the leadership and the creativity to collaborate in developing constructive solutions to offer a decent future to present and succeeding generations. We have the capabilities: we must find the will.”
It’s the Institutions
A New Vision
The Big Picture
The Power of Money
Phantom Wealth vs. Real Wealth
From the standpoint of society, money is properly treated as a means, not an end. Rather than directing money to financial speculators and scam artists devoted to creating phantom wealth for personal gain, we must create proper official money systems designed to effectively link underutilized resources to unmet needs to improve the health of our children, families, communities, and the natural environment. Such systems will necessarily be publicly accountable to local people and communities and therefore highly decentralized.
Institutional Systems Design for a New Economy
Agenda for a Phantom Wealth Economy
- Adopt gross domestic product (GDP) and share price indices as the primary indicators of economic performance. Then give priority to public policies that grow GDP and the price of corporate shares.
- Shape monetary and fiscal policies to prevent wage “inflation” so productivity gains go exclusively to corporate owners.
- Tax the capital gains of owners at a lower rate than the wages of workers.
- Create a debt-based money system that assures a private for-profit bank is receiving interest on every dollar in circulation.
- Give monopoly control of the official money system to a few very large private banks that trade in share and bond markets for their own accounts and profit from financing financial speculation, asset bubbles, loan pyramids, and corporate buyouts.
- Organize the economy under the control of global mega-corporations that manage internal economies larger than the economies of most countries to maximize financial returns to owners.
- Aggregate the savings and retirement accounts of working people into investment pools, mutual funds or retirement annuities, managed by professional portfolio managers who are evaluated and compensated on the basis of short-term financial results. Make retirement income dependent on the performance of these funds.
- Use corporate media to glamorize highly consumptive lifestyles as a cultural ideal and build individual identification with global corporate brands.
- Cultivate the idea that the individual's highest obligation to society is to maximize personal financial gain.
- Make university students dependent on borrowing to finance their education so they leave school with debts they can repay only by working for big corporations.
- Implement a money-driven election system that makes politicians dependent on funding from wealthy financiers.
- Instead of taxing the rich, fund government programs by borrowing from the rich at interest and taxing the poor and middle class to repay the loans.
- Use the power of government to enforce corporate monopoly ownership of information, knowledge and technology.
- Implement international agreements that eliminate economic borders as a barrier to corporate expansion, place upper limits on social and environmental regulations, and favor foreign ownership and imported products over local ownership and locally produce goods.
- Reduce all values to financial values.
- Make money creation and allocation an unregulated private monopoly operated by private bankers and financiers for their private benefit.
- Concentrate and centralize ownership detached from public accountability, shift the negative consequences of ownership decisions to others, and shield owners from liability.
- Creates an imperative for growth in consumption to grow profits, cover interest payments, and maintain full employment.
- Assures a perpetual transfer of wealth from the many to the few.
- Strips all but the very rich of a meaningful political voice.
- Readily absorbs political assaults by progressive groups on individual issues, and
- Produces outcomes exactly the opposite of what we need to secure a viable human future.
Agenda for a Real Wealth Economy
- Accept the status quo and get on with business as usual.
- Introduce additional rules, taxes, and public services to temporarily moderate the underlying systems self-destructive tendencies, or
- Restructure the entire system so that its natural internal tendency is to support Ecological Balance, Shared Prosperity, and Living Democracy.
- Healthy people, communities, and natural systems rather than money will be the defining value. Decisions will be in the hands of people who love their place on Earth rather than in the hands of global financiers who love only the numbers on their asset statements.
- Official money systems will be decentralized, managed as a public utility and be democratically accountable to communities of place.
- The rights and responsibilities of ownership will be broadly shared and locally rooted. Owners will be accountable for the consequences of their decisions.
- Replace GDP and stock price indices with indicators of the health of people, community, and nature as the basis for evaluating economic performance.
- Organize a new economy from the bottom up around locally-owned living enterprises that root economic decision making in the community, treat profit as a means rather than an end, and define their purpose in terms of meeting community needs.
- Promote universal participation in ownership with a goal to achieve a society in which every worker shares in the rights and responsibilities of ownership and every able-bodied owner contributes to society through productive work.
- Break up big corporations, including banks, and restructure the useful pieces as worker or community owned businesses.
- Decentralize and localize the official money system and operate it as a public utility comprised primarily of locally rooted non-profit or publicly owned community banks and credit unions providing basic financial services and funding productive local investment. Continuously recycle interest in the community.
- Eliminate financial speculation either by legal prohibition or through the imposition of confiscatory taxes.
- Require that corporate advertising and lobbying expenses be paid from after-tax income.
- Build capacities for local self-reliance in the production and consumption of food, energy, water, and other basic essentials,
- Build closed-loop production systems that eliminate waste and the need to mine nonrenewable resources.
- Keep trade balanced, favor local ownership and production, and prohibit use of overseas tax havens.
- Share beneficial information, knowledge, and technology freely.
- Use media and education to cultivate a life-affirming culture of cooperation, material sufficiency, and service.