| Subject: | [socialcredit] Why jobs disappear | | Date: | Tuesday, June 2, 2009 00:10:23 (+0200) | | From: | Per Almgren <almgren_per @.....com>
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This is why jobs disappear!
Imagine that you pick out a group of eleven people from society. Ten of
these are businessmen who themselves, or together with others, work to
produce a variety of products, each one within their specialized area.
The eleventh is a person lending money to the others.
The money lender charges 10% interest (to simplify the calculations) on
the money he lends. All businessmen borrow $2,000,000 each to cover
expenses for purchase of raw materials, wages to employees, plus their
own living expenses for one year. The whole amount of the loans is then
used to buy from the economy, which in principle consists of all other
businesses, people and institutions, including the sector financed by
taxes. The economy has received a sum of $20,000,000.
To cover expenses, including interest payments, each of the businessmen
has to sell products for at least $2,200,000. We assume that the lender
buys products and services and pays taxes for a total of $500,000, which
thus is funneled in to the economy. The market can then as a whole buy
products and services from the mentioned group of businessmen for
$20,500,000. But since each businessman has to sell $2,200,000 worth of
goods, as a group they have to sell $22,000,000 worth. One or more of
the businessmen will therefore not be able to sell products at the
required level if the rest of the economy doesn’t increase its debt by
$1,500,000. At least one or more of the business owners have to file for
bankruptcy or, if the lender agrees to it, borrow another $1,500,000.
The companies faced with the threat of bankruptcy have to fire employees
and/or loose the collateral for the loans. This will be repeated year
after year and more and more businessmen loose out, since all other
groups in society will be affected by the same economical principal. It
is the lenders, who already have more money than they need, who create a
growing debt as soon as they do not buy products and services or pay
taxes on their income from interest payments for the total amount earned.
It is therefore very important to think in new terms – we have to change
to an interest free economy. This would benefit the largest group of the
people while the existing system only benefits a small percentage of the
population.
Per Almgren
From borrowers’ purchases 20,000,000
_From lender’s purchases 500,000_
To the economy 20,500,000
Purchases from the economy 20,500,000
Interest on loans -2,000,000
_Payments on loans -20,000,000_
Borrowers’ deficit -1,500,000
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Why jobs disappear
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