16/10/2011 (English translation 11/10/2012 by Josefien Bruijn) – In a world where the laws of the monetary-economic game brings us debt and the artificial necessity of profit, this law leaves us with real or perceived scarcity, harsh social inequality, segregation and ecological breakdown, each of which will have its own disastrous consequences. As a consequence there are great disaffection and the call for change can be heard clearly. It is time to start co-operating in order to bring about real change. Where are we today and which direction could we take?
The disaffection about our present system and search for change create a need for more profoundness, by which we do not just mean more profoundness of the present system. We also need to be aware of the possibilities of today in order to be able to shape the day of tomorrow. With recent developments around Occupy Together/Occupy Amsterdam and the ensuing media coverage I feel the need to clarify my position with respect to this. In my view many of today’s problems are symptoms of our present paradigm and its socio-economic design. It shows us an obsolete social structure and therefore we lack the direction that is required to shape the future, a direction that recognizes these problems and in whose direction we can move. It does start with a more profound awareness of our present system – of the game and its rules.
The rules of the monetary game
Debt is a product of our monetary system, which is based on money, an invention that can be very effective and that can show us the value of products in a world where scarcity is rife. However, since money is no longer linked to gold, it has turned into a product of trust; in itself it has no value. The majority of our money (95%) is created by private institutions, banks. The value of this money is legitimised by its recognition by the Central Banks and the monetary rules that pertain to this system. These Central Banks are not subject to any democratic influence whatsoever. Neither parliaments, nor the authorities have a voice in the decision-making process
This moneymaking process is described by Fractional Reserve Banking. Suppose you saved € 10,000 and you deposit this money in the bank. The bank only needs to guarantee 3% of the debts that have been put out. This means that it can subsequently lend € 9,700 of your savings. Your neighbour wants to buy a new car and is € 9,700 short, so he concludes a loan with the bank. The car dealer deposits this € 9,700 in his savings account for his old age. The bank needs to retain only 3% of this € 9,700, € 291; the remainder of the money can be lent again. And so the remaining amount of € 9,409 will be lent again. The economy is flourishing and there is enough money for investments!
However, after lending one hundred times an amount of € 317,958.02 will be in circulation. Deduct the original 10,000 from this amount and by this process € 307.958,02 has been created from the original € 10,000.
Through Fractional Reserve Banking banks can create a multiple of the original amount of money – by issuing new loans, money is created from thin air automatically and without effort. This causes inflation, devaluation of money and thus is a strain on the money owned by each of us. It means that you will have to work more for the same level of prosperity. Unless you have enough money in the bank to compensate for this inflation, you will either be losing out or not profit in equal measure.
However, the bank charges interest over the amount it lends. In order to pay the interest money will have to be taken out of the existing money circulation. This has to be produced somewhere and more loans will have to be concluded or somebody else will lose out on this monetary scramble. Debt through interest requires more debt and creates more interest. This is an exponential development that is not sustainable – a pyramid scheme where on the one hand interest on debt and on the other hand interest on money owned is a form of inequality that is built in into the monetary system. We will have to change from viewing money as a means of exchange to viewing money as a cause of inequality because of which money becomes a means of power.
It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. -Henry Ford
The rules of the economic game
The socio-economic model itself, which creates its own supremacy through profit, has its own disastrous consequences as well. Because of this monetary costs are shifted towards real costs for society. It is more economical to limit social costs (wages) and it makes more economic sense to shift these costs to the environment; in doing so these costs are ‘externalised’. Otherwise bankruptcy or take-overs could be imminent
And inequality is built in through profit as well. The necessity for companies to make profit causes the joint labour, which results in profit, to end up with the shareholders, the banks or the wealthy. In the first instance this was not a problem. However, currently the inequality takes ever increasingly extreme forms. Small and medium-sized enterprises feel the multinationals breathing down their necks; they benefit in a more prominent way from the interest and profit mechanism. They benefit by the privatisation of public possessions – internationally even forced by structural adjustment programs created by the International Monetary Fund (IMF) and the World Bank (WB). Their voices increasingly jeopardize the voice of democracy.
We live in a world where 1% of the populations own 40% of our planet. What would your street or village look like if 1% of the residents would own 40% of the street or village? What kind of consequences would this have? Yet it would not do to point at culprits. In this example actions and their consequences can be understood. In our global economy the consequences of our decisions are concealed by the disassociation between our decisions and their consequences. Not only does this make accountability virtually impossible, it also makes it undesirable. We cannot expect a manager or a consumer to be conscious of the many consequences of their choices
The authorities could compensate for these consequences, although I do not think that the authorities actually have this insight. This would, however, require extensive regulation, bureaucracy and considerable investments. Instinctively this does not feel like contributing towards society and in addition there will have to be an authority that will see to it that these rules are being observed. If we offset this against the huge inequality and the power this would require, this route raises serious questions with respect to feasibility and desirability.
The macroeconomic influence seems to have surpassed the influence of democracy. It is characterised by institutions such as multinationals that hardly pay any taxes. As a consequence the costs for the maintenance of our state spending are borne by small and medium-sized enterprises and by people with average incomes. In addition particularly small and medium-sized enterprises are put at a disadvantage by bureaucracy. The injunction on provisions issued by the Dutch Finance Minister that should solve the problem of the usury policies strike small and medium-sized enterprises, the insurance companies are excluded from this. The people and the scientific world may endorse sustainable energy but still nuclear and gas-driven power plants will be built. Iraq?
In addition to the desirability it should be realised that the authorities themselves are subject to monetary as well as economic rules. The monetary rules provide them with a national debt which grows exponentially due to compound interest. This debt is not allowed to exceed sixty per cent of the Gross Domestic Product (GDP). And if the authorities do not want to exceed the boundary of this percentage and still want to maintain their spending pattern – after inflation and interest payments, they will have to follow the economic rules in the pursuit of economic growth.
In a globalising world we can wonder what shapes the morality, justice, and organization of our society if neither the market nor the authorities can supply them.
The last lap Often the increased prosperity that we have experienced since the Second World War has been ascribed to the way the post-war world has been organized. Or it is concluded that the capitalist way of free-market thinking and the Washington Consensus may have gone too far but that it has brought us the prosperity that we know nowadays. However, this ignores the two most important factors that have caused our recent prosperity, namely the easy access to oil and the development of technology, which replace labour and increase production. It is mainly these factors that our pyramid scheme has profited from.
Paradoxically enough this technology is also the factor that makes evident the unsustainability of the economic model. The development of technology is what humanity has innovated time and time again and which has brought us progress. The bow and arrow were one of the first extensions of our bodies. The acceleration of technological developments that have subsequently brought us agricultural implements and the wheel has enabled us to set up villages. People were freed up from the daily hunt for food. Crafts, trade and cities came into being.
Subsequently the industrial revolution has brought us the switch from products that were manufactured manually to products that were manufactured by machines. This process was refined and has created another freedom. Gradually the production of goods required increasingly less human labour. This new freedom made way for the service industry.
In 2010 the service industry provided 72.5% of our jobs, the manufacturing industry provided 24.9% and agriculture a mere 2.6%. Globally these figures are 63,2%, 30,9% and 6%, respectively. However, a new freedom awaits us.
In our economic model the producer needs the employee to manufacture his products that are then sold to the consumer. This game is kept alive by consumption. However, at the moment current technology is automating the service industry and thus removing the employee and therefore also the consumer from the equation; this creates technological unemployment. These jobs will not return. Technology currently frees us from the service industry.
The occupational therapy in economic, financial, legal, and security jobs, as well as the managers to keep the system alive have hardly any added value for society and can only absorb this blow for a limited amount of time, nor can the marketing industry on which many multinationals spend more money than on actual production costs. However, this type of advertising is necessary to maintain the system of essential cyclical consumption through manufactured demand and advertising. How would our perspective change if we replace the phrase advertising by ‘propaganda for our money value system’?
‘Nobody is more hopelessly subjected to slavery than those who erroneously believe to be free.’ – Johann Wolfgang von Goethe
In case this technological unemployment or the collapse of the monetary pyramid scheme is not to herald the fall of the world as we know it today, it will be the current social unrest. In the increasingly prominent rat race towards the fulfilment of basic needs an increasingly stronger mentality develops in which our environment forces us in the direction of a more individualistic, more stressful, more intolerant and polarised world in which the solution seems to lie in the success of the individual; thus the empty concept of free market thinking is stimulated and given an increasingly prominent role. This is an alarming development in which the lack of social cohesion heralds the decay of society.
We all played along The dissatisfaction and polarization are reflected in current political relations. This is not limited to the Netherlands or Europe, but it is a global tendency. We view an increase in prosperity but the majority does not seem to benefit from this or only to a limited extent. The polarisation of the political climate is only a recent reinforcement of a few of the many false dichotomies that we know and of which the antithesis right-wing – left-wing is the most prominent. The compassionate entrepreneur needs the freedom to pursue his passion in such a way that this does not contribute to the many disastrous consequences caused by the profit mechanism. He also should be free from the excessive restriction in the shape of ‘correcting’ bureaucracy by the authorities..
And yet each of us contributes to the reinforcement of this system through the alienated mechanism of our globalised world. The inhuman effects of the choice of the consumer or the manager limits the moral accountability because it makes it virtually impossible to have insight into cause and effect and in doing so says almost nothing about the humanity of the individual. All of us seem to be caught in a model in which social change can only be effected to a limited extent. In those of us whose human empathy inspires us to start treating the symptoms that the game entails, this causes a feeling of despondent powerlessness.
Beyond the game The time has come for a holistic, multidisciplinary approach of our problems, a direction in which we can shape the future together. Is this at all possible or is it utopian?
The most important step to real change emerges from understanding the mechanism of our present society followed by realization of its possibilities. This awareness requires an effort of the critical mind. This takes time and energy and is rarely pleasant. It is an effort of the brain to reach a better understanding with our intellect. It is from this realization that a change of mentality and a different attitude to life can develop and from this realization the many individual initiatives can emerge that will find each other in a shared direction of change.
Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has. -Margaret Mead
More profoundness changes ‘Utopia’ into feasibility. However, change never comes of its own accord – it requires work. Beside the critical mind this requires a second important human characteristic: empathy. We are not used developing fundamentally different thoughts about the design of our society. The empathic ability that our mirror neurons provide makes us the social beings that we are and provides us, in combination with our intellect, with the possibility to devise a different type of society. The need for a fundamentally more humane, social and liberal economic society is the greatest challenge for our generation. Science and technology provide our generation with the opportunity to take up this great challenge and to overcome the problems that our era poses us.
‘You can never solve a problem on the level on which it was created.’ ‘Imagination is more important than knowledge’ —Albert Einstein
A truly sustainable knowledge economy: the resource-based economy In the past technology has given us the freedom of labour and shortage, as has been described briefly before. It is also the technology that will offer this to us in future. The introduction of personal sustainable electricity will not only create national and regional freedom but individual freedom as well. Currently the world produces an abundance of food. On a local and ecological level technology can provide almost fully automated food production in abundance through aqua- or hydroponics. This can even be done in stratified layers in the form of flats so that less land will be required for agriculture.
The technological know-how to automate our mobility – even cars – has already been developed. The precision and efficiency will make it possible to virtually bring down the number of traffic accidents to zero. For over thirty years we have disposed of the knowledge to power our cars with electricity. The magnetic elevation trains (maglev) may be able to realize speeds of 3500 km/h. Through RepRap and contour crafting we can ‘print’ 3D products, even houses with one press on a button. RepRap 3D printers, small-scale printers for home use that can also print their own parts offer endless possibilities. Why still buy tools?
This list could go on forever with examples from health care, education or the manufacture of goods. However, the list is characterised by the main expenditure for which we work for energy, food, mobility and housing. Through automation technology can provide these products in abundance and therefore for everyone. This means a dramatic reduction of the working week. Even more importantly it could make the middle class as we currently know it redundant in the near future. Any of these examples is also characterised by the opportunity to decentralise. Both abundance and decentralisation undermine the power structures by which shortage currently is maintained and reinforced.
All truth passes through three stages: first it is ridiculed, second it is violently opposed. Third it is accepted as being self-evident.’ -Arthur Schopenhauer
A paradigm shift Let us consider this for a while. What does technological decentralised abundance (TDA) actually mean? If this is combined with a sustainable relation with the environment, this will represent a fundamental, worldwide change in our way of life. There where sustainable TDA is present, money will not be needed for these products. If we connect this with a few developments mentioned before concerning TDA it follows that you do not need to work to pay for energy bills (personal energy needs), for daily food (hydroculture) or for products in and around the house (3D printers). The working week will be drastically reduced. And eventually your own job in the service industry will be discontinued because of technological unemployment. The labour for money paradigm is nigh.
A continuous movement will have to occur towards the use of sustainable raw materials as opposed to scarce raw materials and from global towards local. Science and technology are already providing answers to many of these questions; these answers range from alternatives for plastic and meat consumption to ideas such as cradle to cradle. If we are to realise a resource-based economy we will have to find our answers for tomorrow in a technological approach, instead of in a monetary or even a political approach. If the authorities are to play a part in the resource-based economy they will have to invest in research but also to provide active support for practical decentralised projects. However, they will have to be able to rise above the monetary paradigm, above the mechanisms of profit and economic growth. This challenge will place them outside of the financial supremacy of the present time. Stuck in the navel gazing about a left or right-wing approach of fictitious distribution problems and stuck in the popularity franticness of election times I think the chances of a vision with future perspective are slim. The answer is with you.
Technological decentralised abundance as opposed to profit TDA provides us with an open playing field where we can learn from one another and thus can improve concepts. It is the world of open-source, science, expertise and experience. It shapes a world that returns freedom to the individual. It gives us the opportunity to develop ourselves with respect to our passions and ambitions. It returns insight into cause and effect and thus provides responsibility and accountability. Anonymity is replaced by respect for the individual. It shapes a world that brings back community spirit. A world in which time will return our humanity and creativity to us. It shapes an environment that is geared towards our human needs. Possession as a human reaction to scarcity will make way for access and for use in ways that are adjusted to these needs. The investment that will be required during the transition period will be huge, as will the number of jobs to be created. Not jobs for the sake of jobs, but jobs that make a genuine contribution. Work that matters again.
“Nothing is stronger than an idea whose time has come.” -Victor Hugo
Profit gives us shortages: the greater the shortages, the greater the profit. This self-reinforcing process has a destructive effect on humans and on their environment. It gives us inequality which results in possession of land, raw materials and ideas (patents). Access to our land, raw materials and ideas is obtained through money: a means of scarcity that is perpetually losing its value through inflation and that keeps us imprisoned in the individual rat race towards money through labour.
Profit gives us propaganda for a money value system (advertising) that maintains a fictitious scarcity. Status is derived from certain scarce products over others. Conformity through propaganda teaches us to want more. By definition it is a race that cannot be won – the new, distinguishing scarce product is already waiting in the wings. We accept the psychological and physical health effects of these status differences and the struggle to survive, the stress that is accompanying this pursuit of money for access to land, raw materials and ideas, and we put up with the sacrifices as well – individualism, lack of parenting, the crimes committed for possessions or status. The monetary system with its money is the religion of our time. In ignorance we remain imprisoned in our illusion of freedom and democracy.
The next move… is yours If we choose to continue the present macroeconomic monetary political decisions, we opt for a further concentration of power, for greater inequality and marginalisation of your democratic vote in a system that is bound in this financial supremacy; in this system the extent to which social change can be effected is reduced more and more. It precludes economic democracy and individual freedom. Food prices become the plaything of speculation. The rat race towards money in a world with increasing scarcity will result in social unrest. Small and medium-sized businesses will become a pool of patents and potence for the multinationals and sovereign countries will become obstacles for the procurement of scarce raw materials.
You will notice none of this; the authorities will keep you safe and will give you freedom and democracy. Television teaches you that the world is dangerous – fortunately it offers you amusement as well. You will obtain your certificate and work towards a job that has been promised to you. It may not be ideal, but at any rate you will earn some money. For the few for whom this society does work, as opposed to the majority, the role of self-appointed guardians of the status quo awaits, the proclaimers of the money value system. Caught up in debt we wait until institutions such as the IMF will help us. We wait for cutbacks and privatisations. We wait until the sovereignty of countries, companies and even individuals gradually drains away. We will wait for the social unrest that is the consequence of scarcity and for polarisation. We will wait for the increase of the number of ‘terrorists’ and for the governments that will protect us. We will wait. We will wait and then we shall wonder how it could happen that our society has fallen apart.
‘My work (…) is not directed to intellectuals and politicians. It’s directed to what are called ‘ordinary people’. And what I expect from them is in fact exactly what they are.
That they should try to understand the world and act in accordance with their decent impulses. And that they should try to improve the world.
And many people are willing to do that, but they have to understand. I feel that I am simply helping people develop a course of intellectual self-defence.’ -Noam Chomsky
Or we could choose the path provided to us by TDA. You, your neighbourhood, your region will control your life and your living environment through co-operation and through adjusting available goods towards your needs. Justice will be done yet again to the word democracy, because it implies that voters are wise and knowledgeable as to the effects of their choices or of the choices that will be made for them. Not the voice of scarcity is decisive for geopolitics but the mutual advantages of co-operation. The insight into efficiency created by co-operation will shape decisions taken by authorities, not from the power provided by money but because municipal hydroculture is more efficient. The need for possessions inspired by scarcity will make space for access and use. Not everyone needs a lawn mower and boating excursions on the lake can be adjusted to demand. Specialised access centres will provide in people’s needs where frequent use of goods is not required.
Carpe Diem, seize the day, one of the oldest wisdoms we know. Surviving for the day of tomorrow will no longer keep us from the freedom of the moment. Time will have been given back to us to realise what is really important in life. This will make you think of friends, family, a partner, of doing what you’re passionate about and subsequently being valued for this. People will find each other in passions and ideas. TDA will create the space for a society in which people can develop in balance with their environment and with their human needs. A society that will even enrich the ‘richest’ person on earth. All of this is possible today. The choice is yours.
‘Be the change you would like to see in the world’. -Mahatma Gandhi
The times they are a-changing The industrial revolution has freed us from physical labour. It has also brought us fear of what was to come, fear of the unknown, and fear of the freedom that the industrial revolution would bring us; on a larger scale it has also centralised power into the factories, the land owners, a new elite. The chimney was not only the symbol of economic power and of progress but also of social inequality. The political movements came into being and people united in political parties. The problem of distribution could be solved politically and a new consciousness arose. We will now witness a similar process. Technological decentralised abundance, however, will move us towards a sustainable era that will provide us plenitude.
Our generation has the unique opportunity to live through these developments: the revolution is happening now. It is up to you and thus to all of us together to shape this future. Maybe it will not be shown you such black-and-white tones as outlined but it shows the tendencies that we should take into account when making our daily decisions. We shall have to learn to think outside of the self-imposed boundaries of the mind. If we stop taking this system for granted the door to new ways of thinking will be opened. It is important that we find the courage to start dreaming about the future again.
These developments have provided space for movements that have been spreading these ideas for a longer period of time, such as Anonymous, The Zeitgeist Movement and recently perhaps the Occupy Movement. It is the voice of a generation who have been teaching itself through the Internet by documentaries such as “Money as Debt” and “Zeitgeist Moving Forward”, who have studied and found one another. The Internet will be the platform for the next revolution – a role played by the printing press for the scientific revolution, the precursor of our industrial revolution.
It is up to us all to develop a new consciousness on the road to tomorrow. We have a choice between ignorance, apathy, passivity and fear on the one hand and awareness, empathy and trust in fellow human beings on the other. And the choice is up to you, here and now.
Cowardice asks the question, “Is it safe?” Expediency asks the question, “Is it politic?” And Vanity comes along and asks the question, “Is it popular?” But Conscience asks the question “Is it right?” And there comes a time when one must take a position that is neither safe, nor politic, nor popular, but he must do it because Conscience tells him it is right. – Martin Luther King
Translation by Josefien Bruijn, for which my warm thanks.
In order to bring an accessible, interesting background I provided further reading or viewing material to the text through links. If you are interested in one of the subjects, I would enjoy giving you references to further material.