Post #800: Powerful Ideas For Economic Transformation.

by Jerry Alatalo

“So long as all the increased wealth which modern progress brings goes but to build up great fortunes, to increase luxury and make sharper the contrast between the House of Have and the House of Want, progress is not real and cannot be permanent.”

– HENRY GEORGE (1839-1897) American economist, single tax proponent

aaa-42The worldwide economic crash of 2008 which humanity deals with up to today generated a massive conversation about economics and banking, in particular sparking great interest in alternatives offering better outcomes.

What has happened is that people have researched, studied, developed and articulated good alternative systems in the roughly seven years since 2008. The small group of people who control the global financial system have noticed the extraordinary interest in new alternative theory, and, for fear the alternatives will actually gain traction and become implemented, years ago began planning the trade deals called Trans-Pacific Partnership (TPP) and Trans-Atlantic Trade and Investment Partnership (TTIP) to effectively kill any alternatives.

The Occupy movement made the phrase “We are the 99%” part of the global culture, for the first time unveiling/introducing the 1% to all people around the Earth, and essentially lit the fire of an ideas-for-the-future war between the 99% and 1%.  One has only to consider that both the TPP and TTIP – the largest multi-nation trade deals in history – have and are being written in secret to understand the immense importance of what is going on here, and why the deals’ details must become made available for examination by every person in nations potentially signing on – before the deals become voted on and/or made the law of the land.

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Given the more urgent task of fighting for total transparency with regard to TPP and TTIP because of the enormity of consequences a very large percentage of the world’s people will experience if passed, it becomes easily understandable that focus on alternative solutions has been placed “on the back burner” so to say.  If one’s house is on fire, it becomes necessary to put out the fire as opposed to spending time in the vegetable garden. Reports suggest that men and women in potential TPP / TTIP signatory countries are doing commendable work in opposition to the way the trade deals haven’t been presented in full for their consideration, along with strongly expressing legitimate concerns to elected representatives.

Economist Scott Baker gave an excellent presentation recently on highly practical, beneficial economic/financial alternatives for people living in the United States. With hopes of reinforcing efforts around the world for promotion of new and implementable ideas that offer citizens real options for improving living conditions, a video of his presentation is being shared here.

While his talk is directed to Americans the ideas presented are ones that apply in any nation. The four foundational concepts Mr. Baker builds upon and explains in the talk he calls “Super-macro economic solutions”, each when implemented capable of saving governments – the people – trillions of dollars:

  • Sovereign money, aka debt-free money
  • Land value taxation, aka Georgism
  • Public Banking
  • Ending government financial asset hoarding

Other steps for positively transforming  economic conditions include application of proper regulation to minimize criminal behavior in financial sectors, which would result in re-directing trillions of dollars into government revenue accounts.

Mr. Baker explains why citizens should have no problems in accepting the changes he proposes:

  • Because with good, clearly beneficial incentives people can change
  • People are inherently reasonable and open-minded to good ideas
  • People genuinely want better economic conditions

Sovereign Money – U.S. government can issue the nation’s money without the Federal Reserve

What can fiat money do for the economy?

  • Pay for infrastructure
  • Pay for social security
  • Pay for R+D in science, education, foreign aid, new energy systems, etc.
  • Plus any expenditure which has a positive money multiplier effect

The $29 trillion spent on banks after 2008 resulted only in asset bubble inflation.

An example of a positive multiplier is $1 spent on social security that translates into $2 of economic activity. Negative multipliers include tax cuts for the rich and military spending, which most likely result in a net loss in economic activity.

The next question Mr. Baker answers about sovereign money is “what about inflation?” The nation’s money quantity should be kept as close as possible to the amount needed to meet the nation’s productive capacity. In his view, private banks are not producing/creating enough money through lending, while the Congressional Budget Office in its reports asserts that another $trillion in circulation wouldn’t result in inflation.

Next, he asks “why borrow/rent our money when government could create it?” Since 1913 and the Federal Reserve Act that established the Fed, the Federal government has paid the Federal Reserve Bank for money with interest-bearing Treasury bonds whose interest rate is determined by the Federal Reserve Bank itself. The interest is an expense for the American people which becomes eliminated once the conversion to sovereign money occurs.

Federal Reserve notes or United States notes?

The Federal Reserve Bank owns 18% of U.S. Treasury bonds. Japan, China and other nations own significant portions, and by holding those Treasury bonds China has gained a competitive advantage through devaluation of their Yuan, making Chinese exports more attractive to international buyers and American products more expensive.

A very wealthy rentier class makes a lot of money off of interest on Treasury bonds, a situation which would disappear when Treasury bonds become obsolete and unnecessary through establishment of a sovereign money system. Other reasons for converting to sovereign money include:

  • The independent Federal Reserve Bank can neutralize government spending by increasing interest rates, especially when spending becomes necessary – during an economic recession
  • Even during good economic times interest-bearing debt adds up to 50% to the cost of public projects like schools, roads, infrastructure improvements, public safety enhancements, and so on
  • Sovereign money would result in much less corruption
  • Sovereign money wouldn’t result in the government printing money “willy-nilly” as some warn, but an appropriately staffed organization would keep to targeted levels of money for the nation’s productive capacity

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Land value taxation – Georgism

“There is enough, and to spare.” – Henry George (1839-1897)

Georgists believe monopoly in land is the cause of unjust inequality, and therefore advocate for land value taxation, sometimes called “single tax”. Currently, both homes/commercial buildings and land are subject to taxation, but Georgists propose that only land should become taxed. This view derives from the view that public revenues would best be:

  • Light on production
  • Easy and inexpensive to collect
  • Certain
  • Fair

“The Georgist proposal achieves the goal of ‘left-wingers’ for security and social action, but without restricting liberty. It achieves the goal of ‘right-wingers’ to attain freedom, but without privilege and monopoly”.

Scott Baker describes New York City’s taxation policies, where ‘special deals’ allow luxury condominium complex owners to pay 1/100th the property tax of condominiums costing 1/100th as much; parking lots paying 1/10th the property tax of neighboring properties which are built-upon and efficiently used; and the situation where 60,000 people in New York City are homeless while vacant and under-utilized land are both under-taxed and warehoused.

It is estimated that the average American family would see an annual increase of income of $6,300 if land value taxation became implemented. A single, land value tax would end:

  • Taxes on wages, sales and fixed capital
  • Land speculation – the main cause of boom-bust economic cycles
  • Most rent-seeking activities
  • Causes of most political and other forms of corruption
  • Unjust inequality based on monopoly of resources
  • Urban sprawl
  • Blighted, warehoused neighborhoods
  • Enormous tax breaks for developers, who would then build to sell at more reasonable prices

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Public Banking

America’s only State-owned public bank is the Bank of North Dakota (BND), chartered in 1919 and now more profitable than all the “too-big-to-fail” Wall Street banks. The main advantage of BND for the people of North Dakota and neighboring states is effective empowerment of economic growth through banking practices that keep financial resources inside North Dakota and the region.

Many monetary reform advocates believe the creators of the TPP and TTIP have as one of their main goals making public banking illegal. Their premise is that nation-states shouldn’t compete against commercial interests in an unfair way or “unfair competition”.  It is self-evident that public banking, while good for the 99%, represents the greatest threat for the 1% in the banking industry, as related to loss of profits – from greatly reduced numbers of high-dollar financial transactions.

Some experts on monetary reform have estimated that 40% of the cost of public projects goes toward payment of interest. State, county and city-owned public banks could eliminate most interest expenses that those governments incur when signing loans made to them by Wall Street mega-banks.  Among the many other reasons for establishing public banks are:

  • New financial rules/laws could cause bond rates to soar
  • Minimal operating costs (no bonuses, fees, commissions / no highly paid CEOs / no need for buildings, branches, tellers / no advertising expenses)
  • Banks have unlimited low-interest credit
  • Counter-cyclical lending allows sustainable growth during economic recession
  • Less corruption, more efficiency, more profitability, less expenses (Bank of North Dakota is scandal-free since 1919)

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Ending government financial asset hoarding

Scott Baker admittedly kept this last of the four solutions for the end because of the complex nature of the subject. This section of his presentation could be described as more “esoteric” and perhaps requiring further research to reach a firmer understanding, although accountants and finance experts will likely easily grasp his points.

Basically, the point he’s making is that government entities of all sizes from town to city to county to state levels, from fire departments to public pension funds, are required to produce an annual report of their total assets in a “Comprehensive Annual Financial Report (CAFR)”, which includes:

  • Governmental funds
  • Proprietary funds
  • Fiduciary funds
  • Component units

Proprietary funds, fiduciary funds, and component units included in CAFRs are not included in governments’ yearly budgets, and are where most surpluses are located.

Mr. Baker describes a “proper” budget as made up of: 1) Balance forward of the previous year’s unspent revenues, 2) The current year’s projected revenues, and 3) The current year’s projected expenditures.

Apparently government budget processes omit the previous year’s unspent revenues; in other words, certain actual assets are not included in government yearly budgets. Without resorting to a conjecture-based analysis of CAFRs, we will leave it to the reader to read between the lines of Mr. Baker’s words:

“If a process can be made complex and obscure in order to benefit the elite, it will be”.

There are over 200,000 CAFRs in America adding up to trillions of dollars. Scott Baker is asserting that those trillions of dollars, or portions of those assets, could become utilized in ways which result in better consequences for citizens. CAFRs represent a somewhat obscure, unknown governmental finance subject researched by only a small number of citizens.

That said, where trillions of dollars are involved one could safely bet that, like on Wall Street, extensive levels of corruption and “rigging the system” are present.

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Scott Baker presents four real and solid solutions for building a better economy and financial system in America – solutions of which there is every good reason to believe are achievable.

99% of men and women see that as a “win-win” proposition.

(Thank you to Henry George School of Social Science at YouTube)

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Bank Of Canada May Go Back To Sovereign, Debt Free Money.

Posted on February 6, 2015

by Jerry Alatalo

aaa-42Journalist, monetary reform activist and documentarian Bill Still recently reported on what he describes as “good news from Canada”. According to Mr. Still, a Canadian organization called Committee on Monetary and Economic Reform (COMER) has experienced success in its lawsuit against the central Bank of Canada.

For readers in America, note that the Bank of Canada and the U.S. Federal Reserve are different in that the Canadian central bank is essentially owned by the Canadian people – a public bank, while the central bank of the United States is owned and controlled by a private banking cartel.

Canada’s bank was nationalized in 1938, and for decades issued debt-free money to finance a number of large projects, including airports, subways, a national pension fund, the national health system, various infrastructure projects, and related initiatives for Canadian society’s necessities.

From the time of the Bank of Canada’s nationalization in 1938 until 1974 when the government decided to convert from debt-free money creation to borrowing through the sale of bonds, inflation – in contradiction to predictions by the so-called “gold bugs” – has never emerged as a concern or problem.

In the three years after 1974 and the switch to debt-based money creation for Canada, inflation rose dramatically, and the Canadian people saw the prices of everything climb, especially home prices. The lawsuit brought by COMER and two individuals, calling for the repeal of the 1974 decision, asks that the Bank of Canada return to the debt-free money creation mandate in place from 1938-1974.

Apparently, the government/Bank of Canada has no other option in fighting to prevent a successful COMER lawsuit but to go to the Canadian Supreme Court, which will occur at a future date not yet certain. From Bill Still’s perspective, if COMER prevails in Canada’s Supreme Court in this huge case, such a decision would send “shock waves” through the world’s central banking system.

Worth noting is that the Harper government in Canada has allegedly suggested strongly to the country’s mainstream media to suppress reporting on the possibly historic, world-consequence legal case. The attorney representing plaintiff COMER against the Bank/Government of Canada throughout the legal proceedings starting in 2011 seems to think a form of “gag order” has been directed toward Canada’s largest broadcast corporations.

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For more information, visit www.comer.org

(Thank you to Bill Still at YouTube)

Goodbye Karen Hudes, Hello Bill Still.

Posted April 30, 2014

by Jerry Alatalo

“A man’s judgment cannot be better than the information on which he has based it. Give him no news or present him only with distorted and incomplete data, with ignorant, sloppy or biased reporting, with propaganda and deliberate falsehoods, and you destroy his whole reasoning process and make him something less than a man.”

– Arthur Hays Sulzberger (1891-1968) Publisher, New York Times

abstract4-1Is it a big deal or not? Disappointment experienced after becoming aware that what one thought about another isn’t quite right is a hard thing to deal with. This blog has posted three interviews of Karen Hudes – a woman known as the “World Bank Whistleblower” –  since its inception in late May 2013. Ms. Hudes has appeared on many interview programs in the past few years, while many have come to view her as a “hero” for her fearless speech directed at the super-rich and powerful. This writer admits having an initial fascination with her, because her early accounts seemed to prove that she was a genuine and important whistleblower.

That fascination led to a willingness to stay tuned to her as time moved along, and intermittent listening to most recent interviews etc. Unfortunately that initial fascination has turned to disappointment, and the deleting of her posted interviews and web address. This personal transition in perceptions of Ms. Hudes was a slow one, and finally second thoughts and a few analytical questions made the break from Karen Hudes inevitable.

The first question that created doubt about her was “why has she never appeared on any panel discussions with monetary reform activists, attorney colleagues, and/or economics professors?” So, one looks at her public persona and finds that her appearances – including RT, but mostly internet radio/alternative news – are never ones where she engages in group discussions. She always appears alone with a lone interviewer.

Perhaps because she is an Ivy-league trained attorney with a degree from Yale, along with her study of economics in Europe, it became clear that interviewers were somewhat intimidated with her credentials, including her 20 years in the World Bank. As time went by, it became perceived that, because of that constant credential-intimidation, interviewers were derelict in their duty to dig deeper into Ms. Hudes’ claims. All along, with each of her hundreds of interviews, no host has asked the type of penetrating, intellectual questions which would force Ms. Hudes to prove her assertions.

Her talks have been a mixture of well-established facts and theories yet to become proven.

With regard to the unproven assertions, Ms. Hudes consistently mentions a German banker/lawyer by the name of Wolfgang Struck, who she claims has “signatory authority” somehow inherited from Philippines Dictator Ferdinand Marcos – an authority to sign for the release of the world’s entire gold supply. Visiting Ms. Hudes’ YouTube channel one finds she has three videos posted, none of which have become enriched by any appearance of Mr. Struck, the man who is, according to Ms. Hudes, just waiting patiently, in anxious anticipation, to sign off and release to humanity the hundreds of thousands of ounces of gold stashed in Switzerland banks, Philippines banks, and Hawaiian banks, while God only knows how many thousands more ounces were buried someplace in the Philippines.

Wolfgang Struck. The Karen Hudes mystery man.

If any reader has ever seen Mr. Struck speak on camera, or seen any photos of him, or heard him speak on a radio program – if you have any evidence of this “World’s Gold Controller” – please share your information. Most readers are familiar with an American union boss by the name of Jimmy Hoffa who mysteriously disappeared decades ago after last being seen in the Detroit, Michigan area – and never seen again. If by chance, Ms. Hudes, you come to these words, please answer this question, “Is Wolfgang Struck your version of Jimmy Hoffa?”

Ms. Hudes appeared on the scene some three or more years ago, yet has anyone seen her give an academic-like presentation? Has she ever been seen in front of a live audience? Has she ever collaborated with her fellow whistleblowers around the world in a Skype conference call of two hours or longer in duration, where her “team of whistleblowers” discuss specific actions to bring into reality their shared goals?

Just a few moments on the uneventful way I made the decision to separate from Karen Hudes. The son of Academy-award winning filmmaker Oliver Stone – Sean Stone – was spoken about by another talk show host. Without knowing that Ms. Hudes had been interviewed by him, I went to see what was happening lately on his (Sean Stone’s) “Buzzsaw” show. So, Ms. Hudes was appearing and I listened to it. The show began with talk about a so-called “secret constitution” of 1872, where the name of the original became changed from “Constitution of the United States” to “Constitution for the United States”, allegedly making the United States and each of the 50 states corporations.

Sean Stone:    “In 1871, the Constitution of the United States was changed, from the original constitution we all believe we live under, giving us certain rights and laws, and that was changed from the Constitution of the U.S. to the Constitution for the U.S., as a corporation. And that happened in 1871. Can you get into a little more detail as to what actually occurred at that point?”

Karen Hudes:    “Yes Sean, thanks for having me back, and that’s exactly what happened. In 1872, Benjamin Franklin went to Paris and was negotiating with the banks that were helping to finance the Revolutionary War, and, uh, so when the money came due and we couldn’t pay it, this was after the Civil War, which by the way was incited by the Jesuits, at the end of the Civil War, when Abraham Lincoln had issued greenbacks that were not going to carry interest to the bankers, he was assassinated by the Jesuits, and after they had taken care of that business, what they did was they set up this secret constitution, and under that constitution the U.S. Congress became managers of a corporation in the District of Columbia. The states were also turned into corporations, and this allowed the money that was being generated to go to the bankers to pay interest. The money went to the City of London which kept about 40% of it, and then it went off, 60% roughly, went off to the Vatican, the Jesuits, whose bankers were financing the United States. The Federal Reserve is for taking taxpayer money and transmitting it to the City of London and the Vatican.”

Ms. Hudes error of starting the interview by saying, “in 1872, Ben Franklin went to Paris” drew some not small notice from viewers in the comments section – Ben Franklin died in 1790. In the moments after she spoke that historical error, it seems Ms. Hudes has, in her legally trained mind, acknowledged to herself that she had made the date error. Evidence of this shows up/is seen at her first “uh”, where in her mind she comes to realize her mistake. But, instead of sensibly and properly issuing an immediate correction: “Did I say 1872, Sean? I meant 1782”, she makes sure to, a few words down the road, to squeeze in “this was after the Civil War, which by the way was incited by the Jesuits”.

Later on she tells Sean Stone that Franklin negotiated British/European financing for 100 years, resulting in the 1872 default by the American government and necessitating the “secret, second Constitution”.

Bill Still is a man who has researched, written, and produced documentary films on monetary reform for 34 years. He also listened to the talk, then commented on the Stone/Hudes interview: “Ben Franklin died in 1790. That’s all you have to know about Karen Hudes.”

Unfortunately it needs saying but, because of a great respect for Oliver Stone and a wish for his son’s success, Sean Stone allows Ms. Hudes to fill in the half-hour interview without pressing her with probative, get-to-the-essential-facts/proof of her claims questions – an all too universal interviewer style in every Karen Hudes appearance. Simply, no interviewer that I know of has ever directly challenged her to go any deeper, with requests for detailed and complex specifics to prove her – well – unproven claims.

The final straw came after listening to the Stone/Hudes interview when I listened to her on another show. Some internet surfers may have an awareness of these elongated human skulls that the Smithsonian evidently has in their safekeeping. Karen Hudes claims that there is a second human-type race/species walking this Earth, and that they are the “real World power behind the scenes”, essentially pulling the strings of the Jesuits and the Vatican. She gave her proof as coming from a Peruvian man who emailed her that he had seen one of these elongated-head species – “Homo Copensis” (or something) – inside a Peruvian bank while attending a personal loan-related meeting.

No photos, no nothing.

A search at Amazon books failed to find any authored by Karen Hudes.

The questions about who or what is behind or sponsoring her are in need of answers.

Probably the most disappointing aspect of all is that so many fine men and women journalists/alternative media hosts will now have to admit what has been confessed here. Karen Hudes took a lot of people on a long ride to nowhere. While disappointing for many who placed their hopes on her, probably the most descriptive word is saddening. One feels deep sadness for both her followers/believers and Karen Hudes herself.

Let’s hope Wolfgang Struck is happy in Peru.

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That was not pleasant.

Reason for optimism, though.

Bill Still’s latest report goes into some important writings by a world-respected economist about monetary reform. In an April 24, 2014 article by Martin Wolf in the Financial Times, Mr. Wolf – according to Bill Still, a man who “when Martin Wolf speaks, the world’s economists listen” –  suggested the potential of major reform in the way money is created. For monetary reform activists like Mr. Still, Ellen Brown, and others, this development is very large and analogous to an historic scientific breakthrough that promises to change the world.

One has to feel good for Bill Still. Here’s a man who has had his nose to the grindstone researching monetary issues for some 34 years. He’s been like a voice crying out in the wilderness, like the man who has been crying wolf – except that the wolf has been real. He can take some satisfaction that his efforts may finally be paying off, that his very important work making films and writing for over three decades is finally producing fruit.

Visit Bill Still’s website at billstill.com

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From “Desiderata”:

“Therefore be at peace with God, whatever you conceive him to be, and whatever your labors and aspirations, in the noisy confusion of life keep peace with your soul. With all its sham, drudgery, and broken dreams, it is still a beautiful world. Be careful. Strive to be happy.”

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