A Trilogy by Bruce Beach

Meaning of Money

Money Matters
 This third part of my trilogy on money deals with examples of how to operate a local monetary system. The mechanics of establishing the system are in the essay on Making Money - but the principles of operating the system is an art. For this reason it is probably best explained through anecdotes from actual experience.

The Meaning of Money, while a lengthy explanation about the nature of money and how it was created historically, was rather straight-forward to write because it is based on historical facts. The Making of Money was also just an explanation of the mechanics of a simple bookkeeping system. Much more sophisticated double-entry systems are understood by many people. However, the Money Matters that we will be examining here have no concrete examples in history and are therefore difficult to delineate.

It will not be possible to implement the economic / monetary system described here, (and its accompanying political system described in Progressive Democracy) except that there should occur a complete societal collapse as would be the result of some catastrophic event such as nuclear WW3.

What is being described here is the method for the reconstruction of an economic / monetary system in the aftermath of such a catastrophic event. The details and mechanics of establishing both the political system and the monetary system have been described in Progressive Democracy and Making Money, respectively. What we are dealing with here are with the principles of dealing with the situations that will arise, and since the situation can greatly vary from one locale to another and we cannot know ahead of time the specifics, all that can be done here is to describe the principles as they would apply to imaginative situations.

There are alternatives to the approach that I suggest here. A potential community can sit and wait for outside help to rescue them. A pontential community can wait for an outside system to come and impose order on them. A potential community can just sit and wallow in its helplessness and destruction. I prefer the alternative that I present here.

In a post-catastrophic situation, actual anecdotal experiences can be shared and people can learn from each other's experiences but at the present I can present only hypothetical cases. The medium that I shall use is to describe an imaginary meeting of a community council that governs a community of two hundred people - the largest size that I think any root community should be. Beyond that size I feel they should split into two or four separate communities.

Meeting of the Community Council
Item 001

Community Physical Security. The first item of any community meeting must be the community's physical security. Whatever is threatening that security, whether it be an approaching severe storm, threatening marauding bands, insurrection by some small internal group, or whatever - that is the item that will have to be dealt with first.

In this example we will consider that the community is relatively secure and that by consensus of the Servants, security matters can be postponed until later in the meeting.

Item 002

Community Food Security. The second item of any community meeting must be the community's food security. There may be a wide spectrum of issues including stocking and securing the community storehouse, coordinating exchange with other communities, locating immediate sources for foodstuffs, and so forth. The primary concern should probably be immediately and thoroughly supporting the local food production. This is what is meant by saying that, "The Farmer Comes First", because without food - well the result is obvious.

The farmers (food producers) must be allocated whatever resources that they need and can use until there is an abundant supply of food in storage. This brings us to our first example of how the monetary system works. The council simply assigns the farmer monetary credits (money on his account) with which he can hire, pay, labor and other resources that he needs. In the old system this would be called giving the farmer a loan and it is the manner in which money was created both then and now.

Item 003

Community Full Employment. The third item of any community meeting must be the community's full employment. For this the Community Servants need to go down the list of every individual in the community and determine their situation. There may be some so elderly or incapacitated that they can only be concerned about their well-being. They must also assure themselves that children are being looked after and educated.

As previously mentioned - the Community Servants must ascertain that the community's primary needs of physical and food security are being met and that the necessary people are being allocated to that. Beyond that - they must make sure that every individual has an opportunity to be a contributing member to the community. It is interaction between this need and the needs of the community that the next items will be addressed.

Item 004

School teaching. The Community Council should encourage teachers and others to form schools. All children should be assigned an education budget and the credits placed on their personal account to be used as directed by their parents in placing the children with teachers or schools that have received the Council's approval. This will then constitute the teachers' income so that they can make personal purchases from the stores in the community and use their income in such other manner as they wish.

Item 004

Community Security. The Community Council can appoint a chief of Community Security and provide the chief with a budget with which to compensate those to whom he assigns security duties. This equally well applies to fire security and a fire chief. Mind you - all this is primarily on the basis and scale of a neighborhood watch. As the communities become better organized many of these duties may be passed on to the next higher collective of communities.

Item 005

Elderly Care. Just as with schools, some individuals may be encouraged to specialize in this area of service and therefore be authorized to receive elderly care payments from such separately designated accounts. The individuals authorized to perform this care could then also hire / pay other individuals in the community to help them.

Item 006

Medical Care. What has been said of elderly care can equally be said of medical care, and probably many other social functions such as aid in homemaking, development of skills and services of various sorts.

Those who are imbued with the old system will be saying - "Where does the money come from to do all this?" Especially, when there are no taxes!

The money is simply created out of thin air. That is where money has always come from. The Lord did not make any money trees. Money does not come out of the ocean or mines. It has nothing to do with the existence or non-existence of gold or any other metal. The money is just created out of nothing. Its value is determined by the community.

Wealth is created by capital. Physical capital (production machinery). Human capital (labor, health and education). Natural capital (land and weather). If you have these and don't use them - you lose them. The primary responsibilty of the Community Servants is to make sure that all these are as fully employed as possible. Machinery sitting idly about needs to be put to use. Every person should be as fully employed as they wish to be. If you don't make use of the good weather while you have it - you will lose it.

Creating the accounting (money) to put the above factors of production to work is merely a bookkeeping task. Debt is created but then the production pays off that debt.

Item 007

Businesses and Entrepreneurs need to be funded. The Community Servants need to evaluate all proposals for projects as to where they stand in their community priorities. Successful business managers, entrepreneurs and production managers will generate profits for the expansion of their enterprises and the undertaking of new ones.

The Destruction of Money

We now come to a new topic and that is the destruction of money. We have focused on the construction of money, but sometimes money also needs to be destroyed. Keynes and many economists have felt that 'savings' can throw an economy out of balance. There is even such a story in the Bible.

In the Gospel of Luke - Jesus told of a ruler giving an equal amount of money to three servants. The ruler then later called the three servants to him:

      19:16 Then came the first, saying, Lord, thy pound hath gained ten pounds.

      19:17 And he said unto him, Well, thou good servant: because thou hast been faithful in a very little, have thou authority over ten cities.

      19:18 And the second came, saying, Lord, thy pound hath gained five pounds.

      19:19 And he said likewise to him, Be thou also over five cities.

      19:20 And another came, saying, Lord, behold, here is thy pound, which I have kept laid up in a napkin:

      19:21 For I feared thee, because thou art an austere man: thou takest up that thou layedst not down, and reapest that thou didst not sow.

      19:22 And he saith unto him, Out of thine own mouth will I judge thee, thou wicked servant. Thou knewest that I was an austere man, taking up that I laid not down, and reaping that I did not sow:

      19:23 Wherefore then gavest not thou my money into the bank, that at my coming I might have required mine own with usury?

      19:24 And he said unto them that stood by, Take from him the pound, and give it to him that hath ten pounds.

      19:25 (And they said unto him, Lord, he hath ten pounds.)

      19:26 For I say unto you, That unto every one which hath shall be given; and from him that hath not, even that he hath shall be taken away from him.

Regarding usury - it is reported in the Gospel of Thomas that Jesus said:

      95)"If you have money, do not lend it at interest, but give [it] to one from whom you will not get it back."

The intent of all this is that the resources of the community should be put to use. As previously explained - real capital can't really be 'saved' - that is to say remain unemployed. The wind that blows the windmill generates power that is used - or the blades just turn or are feathered uselessly. The workers in a community work or simply spend the hours of their lives by idlely until they pass away. The sunshine and the good weather of today are used - or gone. They cannot be stored up for another time.

It is not unreasonable that credits are accumulated for specific projects nor that individuals accumulate certain amounts of discretionary funds, but there is balance in all things. The safety valve against unreasonable saving is demurrage. In effect a negative interest. The amount of money on a saving account is dimminished say 10% each month. Money use can thus be accelerated by these demurrage charges and there will not build up a potential for demand that the community cannot meet and which would then result in devaluation (non-functioning) of its currency.

There are many other examples that might be given about circumstances that would lead the Community Servants to implement particular monetary policies. Businessmen and entrepreneurs are often quite creative about how they 'work' a system, and that is okay so long as it does not get out of balance in accordance with the sociopathic workings that can occur under the laws of ponerology.

There are also many other responsibilities of the Community Council beyond those of physical and food security and full employment which we have just mentioned. Prime and primary considerations that they must be concerned with are such things as establishing and maintaining justice and assuring the spiritual progress of the community, but this presentation has focused upon money matters.

Meaning of Money