|Subject:||[socialcredit] The Money System Triggered the Bankruptcy of General Motors|
|Date:||Wednesday, June 10, 2009 00:33:22 (-0500)|
|From:||Arian F. Nevin <afnafn @.....com>
In a general sense the article is in accord with the ideas of Social Credit.
Thomas Friedman believes G.M. is a “giant wealth-destruction machine.”
He’s dead wrong. General Motors was, is and will be a giant
wealth-production machine. Industry produces wealth, and G.M. is the
victim of an unsound money system.
The abysmal state of the world economy has no physical cause. We have
not run out of resources, factories, people, or suffered a cataclysm.
All over the world, the unemployed are willing and eager to work, but
are prevented from earning a livelihood because they cannot find work.
An upside down notion of national economic wealth and an unsound
monetary system are at fault.
The wealth of a nation is fundamentally based on the physical wealth
it creates. Physical wealth consists of things that are beneficial to
human life such as food, houses, clothes, cars, etc. The foundation of
a nation’s wealth is the industries that create physical wealth: raw
material extraction, energy, agriculture, and manufacturing. To become
wealthy, a nation must produce and consume wealth. A nation is not
made wealthy through banking, finance, litigation, or insurance.
Individuals correctly regard the money they possess and the money they
are owed as part of their wealth. But, while debt and money are
ultimately ways for individuals to obtain wealth, they are not wealth
in and of themselves. Money is simply the medium by which we exchange
physical wealth. Money and debt are simply human conventions having no
intrinsic value in themselves. Thus, for a nation to be wealthy, it
must produce physical value. A nation should not and cannot consider
the money and debt it holds as wealth. If a nation were to have ten
times as much money as it does now, physically it would not have any
more wealth than before. Thus, though an individual can be made very
wealthy by accumulating money, a nation cannot.
Nobel laureate, Frederick Soddy, distinguished between individual
economics and national economics. Economists conflate the two and
ruinously apply the principles of individual economics to the nation.
In individual economics, outsourcing jobs, work, and entire industries
is beneficial. With lower costs a company is able to increase its
profits. However, from a national perspective we are worse off,
because we are producing less and have fewer jobs. Individual profits
are increased, while the nation is impoverished. Applying the
principles of individual economics to the nation results in a steadily
declining standard of living and increasing unemployment.
The mentality of economists such as Friedman is outdated and wrong.
Vincent Vickers, former director of the Bank of England, described
their mentality thusly: “Without money, nothing can be bought and
nothing sold. Therefore nothing matters but money.” Thereby, G.M.
becomes a “wealth-destruction machine” because it is not making a
profit. But, in Friedman’s eyes Google, which he lauds, is creating
wealth because it is profiting, although it produces nothing and
profits by selling ads. By regarding money rather than production as
the primary factor that drives a nation’s economy, economists have
mistaken the shadow for the substance.
The bankrupt ideas of economists are ruining our nation. American
industry can produce far more than the public can purchase. If
everything produced could be purchased, we would have more jobs
because more production requires more employees. We would be wealthier
and have a higher standard of living. Americans want to work and are
capable of producing. All that is missing is the power to purchase.
The power to purchase is limited because the supply of money is
completely controlled by the private banking system. We have bank-made
rather than government-made money, and banks only create money for the
purpose of receiving interest. Today, money is only created so that
debt can be created and interest charged on that debt. Money is lent
into existence by banks rather than spent into existence by the
government. Only an insignificant amount of money is cash, and the
rest exists solely as data entries in bank computers. Banks create and
destroy money simply by modifying entries in a spreadsheet. While it
is commonly believed that banks lend their depositors’ money, this is
false. Whenever banks loan money, they create entirely new money that
didn’t exist before.
Any economic system that prevents production from being distributed is
fundamentally flawed. The people must demand the government institute
a sound money system run in the public interest rather than let
private corporations run the system for profit at the public’s
expense. A sound monetary system would provide as much money as needed
and in such a way that it allows the exchange of all physical wealth
produced by the nation. Only then will our nation no longer be subject
to the random vagaries of economic boom and bust cycles driven by
speculative bubbles, private financial interests, and a corrupt money
system. If we already had a sound money system, right now GM would be
one of the strongest wealth producers on the planet, employing more
people than ever, and making a healthy profit. The fastest road to
economic recovery is to institute a sound money system.
Arian Nevin is the author of National Economy: The Way to Abundance.
His website is www.nationaleconomy.net .