January 10 2004
TO: Premier of Newfoundland (CC St. John's Telegram)
Dear Premier Williams,
I notice from the news headlines a couple of days ago that your province is facing some serious budgetary shortfalls, and is in the position of having to cut back spending - at least according to popular economic theory, and the suggestions from the Canadian business press and like-minded people. Perhaps, however, it is time we all looked at some different economic ideas - the current ones we have been following for many decades now (in the "modern" world, since shall we say WW2 - or perhaps the early 1970s would be more accurate, but this is not a history lesson) seem to be doing nothing more than making banks and their owner-investors rich and governments poor (and thus less able to provide needed services to the citizens) - which is great, of course, for the banks and their investors - but it was never my understanding of modern democratic societies that we should organize our financial system and governments primarily for the benefit of the banks and wealthy investors - the wellbeing of ALL the citizens seems to be the democratic theory, and as good, practical Canadians and the descendants of sturdy pioneers who did what they had to do to make a good life, when something is not working, we fix it, n'est pas? When the cold winter comes from the north, we construct warm houses and store food to feed ourselves, or when our economy based on natural resource extraction proves insufficient to support us we boldly embrace the modern world of computers and IT, etc - so why now, when traditional methods of finance and banking appear unable, even after decades of sacrifice, to solve the economic problems modern governments face, is it not time to say Enough! and explore new ways of financing the government, ways which are less destructive of the lives of the average people for which the government exists primarily to serve?
Indeed so, I should think. There are, fortunately, many modern alternatives to the old, increasingly discredited "borrow from the banks then pay them interest forever" economic ideas available - alternatives which are much, much better for the people of the society, albeit a little less golden-goose-like, if I might coin a phrase, for the banks and their investors - but then, the good of the many must take precedence in a democracy, and the few are occasionally called upon to sacrifice - and we are sure that the banks and their investors will willingly accept the sacrifice of some part of their (rather obscene, it must be admitted anyway) profits, in the name of the greater good for us all.
(HAHAHAHAHAHAAAAAA - no, no I'm not really delirious!!! - although I am sure the business press would consider that last sentence the product of a demented mind - but please read on.....)
How would you like it if your province could be essentially free of debt within 5 years, the period of your mandate, and the billions you now spend on "debt-service" was freed up to be used for useful things for your people like education or health care? Such a thing is eminently possible, with tools readily available to you - and every government in Canada. All it requires is some courage, a quality Newfoundlanders are well known for, and some political will.
To achieve this, there are two steps you must take: First, you must approach the government of Canada and insist that your provincial government be allowed to use the Bank of Canada to help with your problem - which is, in reality, its legal obligation and one of the main purposes for which it was originally created 70 or so years ago (a 'stable money supply in Canada" - having the country and provinces drained of 20-40% of their yearly income in the form of "debt-service", and due to this constant drainage be denied many necessary services, might be great for the banks, but it is not very good or stable for the people). And Second, to help your citizens through the period of adjustment occasioned by the inevitable capital strike and related retaliations the banks and their investors will engage in while you tear the power that rightfully belongs to the people through you their representatives away from them, you will need to institute a form of local currency for Newfoundland - a public government currency whose most important characteristic will be that it will be created "debt-free" for the people and their use, rather than "debt-based", as almost all circulating currency currently is, which is of benefit to the banks alone.
First, the Bank of Canada. The BofC is legally mandated to supply essentially interest-free loans to the governments of Canada - federal, provincial, and municipal - to deal with financial problems. The loans are repayable of course (although forgiveness is also an option, since it is essentially little more than a book-keeping entry) - so would it not be a much better idea for the Government of Newfoundland to be repaying only a loan, rather than a loan plus commercial debt service charges to a private lender? Of course it would! Getting such loans from the Bank of Canada as your current debts fall due, and thus paying them off rather than refinancing them through the same private interests, will quickly reduce the huge drain of "debt service" on your province's finances. Fear not the bogeyman tales the banks and their paid acolytes in the business press will immediately deluge you with concerning how "irresponsible" such an act would be - remember who they are working for!!! - there is some obligation on both the borrower and the bank to ensure than frivolous borrowing does not take place, but I do not see this as a problem, with an intelligent and responsible government - the only effect would be to free up for more useful purposes a substantial amount of money that was formerly collected in taxes and paid to private investors. In truth, the old system of borrowing from private banks then turning over huge amounts of taxpayer's money into the foreseeable future under the excuse of "debt service" was and is the irresponsible act (at the very least - many might be inclined to label such highly-questionable-at-best fiduciary behaviour as criminal conspiracy, but getting into all that is not the purpose of this particular letter, so I'll leave it for another day).
Secondly, to regain control of your provincial finances while substantially improving the lot of the citizens of that province, both those who voted for your government and the rest, insofar as there is any kind of shortage of "legal tender" with which to pay people their entitlements and undertake necessary government business such as infrastructure maintenance and development, and you are not empowered to print "Canadian" legal currency to relieve this, and borrowing from the banks and increasing your legally obligated "service charges" is not a good move, the establishment of a "local currency" of some sort is an available and forward-thinking way out of your dilemma. The only puzzle to me, really, is that more governments have not been doing this over the last couple of decades - but I suppose the banks are very much opposed to this, and such banks have been quite influential in establishing national financial policies. As I would note again, it is long overdue that such power in private hands was reduced - the local currencies would go a long ways to achieving this, and return power over the national or provincial finances to the people and their elected representatives, where it rightfully belongs. You could truly be a leader of note (haha - no pun intended - but a good one!) both in Canada and the world were you to take the truly bold step of doing this.
The establishment of a local currency does not mean printing a bunch of money and handing it out like Monopoly money, as many scornfully suggest - we all understand that money must be be earned or it has no true value, and must also be related to the amount of goods and services available in an area so that the old horror story of "too much money chasing too few goods" does not materialize. But local currencies were never established to compete with existing currency, thus denigrating both, but have only been established to deal with situations where a community has lots of willing workers, lots of resources to be utilised, and lots of demand for such products and services - but insufficient "legal tender" to pay for the labour or goods involved, to "grease the wheels of commerce" shall we say. Bartering is primitive and limited - a convertible currency is needed (I don't mean convertible into other currencies, but in its original meaning, that is to remove the many limitations of direct bartering among a large group of people - person A's labour can be "converted" to a loaf of bread or rent on their house or a piece of fish through an accepted common means of exchange such as a widely accepted banknote of some sort without direct bartering - which is what any currency ought to be doing)
What if, Mr. Williams, you were to mandate that say 20-30% (or be bold and say 50%!!) of all government expenditures in Newfoundland were in the future going to be paid in "Newfoundland Dollars", and every business operating in Newfoundland was obligated to accept the same 20-30-50-% of such currency for any transaction as legal tender in your province? Government employees and citizens receiving government money, and businesses providing government services or goods, would be the initial receivers of the currency, from which it would spread throughout the province. Immediately you reduce your reliance on the Canadian mint and private banks and their intentionally-in-short-supply "debt-based" money by the same 20-30-50%!!!! Sure the banks will scream bloody murder, but there is no legal reason this cannot be done. The Bay-St-indebted federal government will quite probably originally side with the banks in trying to protect their turf and profits, but if you were strong and committed, you could provide a great service to all of the people of not only Newfoundland, but Canada, by challenging their interest-bearing monopoly on the Canadian money supply. I can also assure you that you would find a great many people who would support you in this endeavour, as well.
Yes, certainly there would be problems - but nothing that could not be dealt with, and nothing as large as the ongoing problem of having to turn over huge amounts of taxpayers' hard-earned money to private banks, forever and ever until death do you part.
Well - I needn't go on at length - all of these things are very well documented elsewhere (for instance, you might start here - Community Currencies - for some informative reading) - the bottom line is, as always, the political will, and in whose interests that will is going to be exercised. Unfortunately, for a long, long time now, the political will has been subjected to the will of the bankers and their cronies and their desire for great profit, thus the system of debt-based money has prevailed. Should you wish to have the good of the people of your province prevail (a most radical notion, I will admit!) - I have showed you the path you can choose to take. The choice is yours - please the people - or please the banks.
(PS - although I write from ????? where I currently work, my mother was from Placentia and I have had several memorable visits there, and have lots of family around the ol Rock still, thus I feel connected, and will always be proud to call Newfoundland almost home)