The battle of the budgets is about to begin. The din of craziness will be amplified. Once again it will become clear that the cart runs before the horse. Money rules over matter. Leaders in Washington will be tossing about numbers with little or no regard for the real-life consequences of their monetary manipulations. Real people will suffer and some die because of their obsession with reducing the digits in the Federal budget.
They never stop to consider what money really is and what its real role should be in a nation’s governance. They behave as if there were a limited quantity of money in the world and we must be careful not to “spend”—i.e., “use up”--too much of it, for then there won’t be enough left to increase their wealth and that of their corporate friends. They are convinced that in order for them to become wealthier, others must become poorer.
Confronted with this, money manipulators would deny such accusations. But social scientists know (or should know) that most human behavior is based upon unconscious ideas and motives. Even while speaking as a knowledgeable, rational economist, one’s actions are likely to be guided by subconscious mental elements.
In earlier DK diaries and in a small e-book, “Money As Information”, I have been arguing that the basis of money (a man-made concept) should be its effectiveness in meeting its goals of making life easier for all people. By that criterion, money is an abject failure. To quote an old, old song, “It’s the root of all evil, of strife and upheaval”.
Money has no intrinsic value. It bears no natural relationship to gold or silver. Nations have been printing fiat money for many years and the world hasn’t ended. Money should be regarded as a certificate, a conveyor of information from its creator, the Federal government, that its owner can use it for any of its normal, legal uses—to buy goods and services, etc.
Since government has the power to “print money”, it should be free to issue enough to cover the needs of its citizens and foster the welfare of the nation and its physical and social environments. Trimming national budgets, especially in times of great need, is not only nonsensical, it is insane.
I won’t try to cover every budgetary feature arising from such a re-definition of money, lest this diary grow to unwieldy length. But suffice it to say that deficits would become a thing of the past.
This changed definition of money would be the ultimate solution to a myriad of national and international problems, but it could never happen within a single legislative year. However, I wish that enough economic leaders would consider this approach as one that can happen in the near future and thus be satisfied with going easy on the current budget, in the knowledge or hopes that a better solution lies ahead.
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
Earlier diaries on this topic:
Goverrnment's real hidden debt
Re-thinking the mystery of money
Eurotrib diary