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Hello Trevor, and welcome to the Elistas group,
When you
write:-
"The application of the principle of creating debt could and
should be used to create the medium needed as debt free funding
streams for the provision of essential infrastructure, which has been
pre-designated as public good by the public."
I have to ask, what would be the
effect on 'consumer prices' when you introduce 'debt-free money' this
way?
The reason for my question is
that, in a sense, we had a situation in British Columbia many years ago where
there was a considerable amount of 'debt-free' money introduced to fund
infrastructure. The US government paid BC a great deal of money to
construct a series of dams and power generation facilities on the Columbia
River's upper reaches.
That river rises in south-eastern BC,
flows northward, then loops to the south again, and finally enters the US on its
way to the Pacific. The US had a series of dams, power stations, and
navigation locks along its length in their territory, but needed 'flood control'
on the BC side to get full benefit from them. At the time, we
didn't need all the power the BC dams would generate, so we traded
some of it to the States for thirty years to offset their paying for the dams,
which we eventually, (in the '90's), got all the generating benefits back
from completely 'free'. It was a brilliantly conceived deal by BC's first
'Social Credit' Party government.
Except for one little fact. Out
of it, we got an 'inflation'. One which eventually ended that government's
20 year tenure in office. Initially it came disguised as
'prosperity'. There was great activity, and anyone wanting a 'job' could
have one. But shortly thereafter 'prices' began to outpace 'incomes', and
the distance between the two continually broadened. So it leads me to
wonder whether financing 'infrastructure' this way will be the great panacea
many people seem to believe. Personally, I think a closer following of
Douglas's original ideas in regards to 'consumer' dividends, paid to
'individuals' through the 'Compensated Price Discount' and 'National Dividend',
would be a better approach. Even if both would likely be a harder sell
'politically'. I don't much care for the way we currently finance and have
to pay interest on public borrowings for infrastructure either. There are
no doubt better ways to do it. But I think I'd want to take a very close
look at the alternatives using 'debt-free money' the way you propose. It
may end up costing you a great deal more than the 'interest' you think you're
saving.
Best wishes,
Joe Thomson.
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