The Real Voodoo Economics & How We Can All Play A Role In Changing The Economy
In my recent piece on Conscious Capitalism I wondered whether the current system could be changed by maintaining some of the elements of an economics seemingly based on individualism..
The source of my concern was the recognition that revolutions generally resulted in mass destruction and violence and whether life improved afterwards was questionable. I suggested a “revolution of consciousness”—but what would that entail? “The Four Horsemen” is not just another apocalyptic movie but a film that asks important questions about the assumptions behind our economic “system.” Is it, as we are told, based on fundamental truths or something concocted by a powerful few to perpetuate their own power? And is the individual in a position to flourish based on his or her abilities, or constrained by a system that is rigged? These are some of the same questions I asked my father, who was an economist in Europe before immigrating here and saw some of the same problems before he died. My dad wanted me to study economics because it is so fundamental to many of the issues we find important. But I became an English major. Later, in reading others, like Jacob Needleman’s “Money and the Meaning of Life,” it became clear that money or currency has an energetic component that is a powerful real force in the world, and I sought to understand it more deeply. This movie helped connect many dots. But let’s simplify. Paper money began in its current form when traders in Florence needed something to exchange as value for their goods. If someone had carpets and someone had spice they could arrange a trade, but when things got more complex, they needed a currency, and money came into existence (along with the middle-men). But the key point is that money always represented concrete value. It was generally backed by gold, until (as the movie points out) President Nixon changed that in the U.S. (President Clinton took it a step further when he allowed banks to merge with investment firms and pool their money, speculating with deposits in risky markets and issuing “financial instruments” which were not backed by value or insured against failure.) The key point of the film is that in the last century private banks were permitted to “create money from nothing and lend it at interest.” This changed real currency to “fiat” currency. Fiat currency is money whose value is established by “decree” (Fiat) and which is not based on anything real. This became the basis for the prevailing economic theory of men like Milton Friedman – a form of neo-economics encouraging debt, that was taken as gospel by politicians like Reagan, Bush and Nixon. This “new economics” was an anathema to classical economists like my father who saw debt as slavery. As the film points out, this neo classical model of Economics is based on “what ought to be” rather than on what is. More directly, the currency is no longer based on the actual resources available on the planet, but rather on what “projections” or “future” reserves might be. And money based on these fantasy models gets printed and lent out at interest forcing those who take out loans to repay mythical money created by a phony financial “industry” with real work. Of course under these conditions those that own actual resources –like land, water, oil and food –become very wealthy. Everyone else will struggle to create value with their labor. In addition, as the “Confessions of an Economic Hit Man” (a site by John Perkins, who appears in the film) describes, this massive debt scam can be used to control and rape third world countries of their resources. And of course the whole system is ultimately disastrous for our species, because pretending that resources are endless and should be owned by a privileged few means that scarcity, famine and “the four horsemen” of the apocalypse are inevitable. Instead of “natural” capital that has real value, the film dramatizes how the world is getting “fuller” of man-made capital and emptier of natural capital. But it is also easy to blame “the system” for these problems. We all need to take responsibility for how we handle the issue of money. If we succumb to a consumer-driven world in which we always need more crap, we will find ourselves in debt to the forces described in the film. Whether a political or social movement can change the way the banks operate is questionable; they also control the military and police of most of the countries in the world with a vested interest in maintaining the system. So as long as it doesn’t collapse (which would also lead to mass suffering) we are kind of stuck within it, making minor changes occasionally –but what can we do? As the film suggests we need to “pay” attention, and there is a reason for this way of coining the phrase, because attention comes at a cost. We need to give up some of our egoism and see the big picture. A huge part of that is not succumbing to the media onslaught dedicated to increasing our personal and collective debt under a rigged system. Even the simplistic notion of infinite “abundance” that some spiritual teachings propound is a fallacy that needs to be examined. We need to live as though our currency does represent value and not spend beyond our means. Many assumptions need to be questioned along these lines. For example, is going into massive debt for an “education” of real value? Or any other scam in our current system for that matter? And our own man-made reality needs to align with the natural world because ultimately we are not beyond or outside of nature. We are part of it and must adhere to its realities. Water, air and resources are finite on this world.
The expansion that has fueled the banks’ ability to create “wealth” from thin air has begun to reach its physical limit. .
Read the full article at the original website
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