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COLUMN: Movement rallying against economic chimera
By Ron Heusen
The disenfranchised poor of the “Occupy” movement proclaim our capitalistic economy is bereft of ethical structure and in urgent need of a paradigm shift to an equitable and just balance of societal and corporate needs.
Unfortunately, the disheveled appearances of occupiers and their constant challenges to our coveted belief that modern capitalism upholds the ethical Calvinist values of hard work, thrift and moderation, close our minds to their sage advice.
At the heart of modern capitalism are corporations that concentrate inequitable amounts of power through political influence, access to technology and control of money.
Corporations have one fiduciary responsibility, to maximize shareholder profits, which results in the movement of wealth into the hands of a few through the continuous erosion of social contracts with people.
Corporations have rapidly adapted to the fluid competitive nature of global markets that utilize people as disposable resources by discarding them for cheaper alternatives. The modern mobility that comes from advanced technology continuously reconstitutes corporate power to such a degree that they have become immune to the devastating social effects that come from industrial abandonment.
This concentrated corporate power requires vast sums of money, and governments working in conjunction with banks, provide it.
Banks and governments keep corporate money flowing by siphoning it from people, creating money out of nothing and by perpetuating myths about the sustainability of modern capitalism. They insidiously hide the environmental fact that economic growth has to ignore the limits of natural ecological systems.
Furthermore, they garner public support by artificially lowering the real “total” cost of production of goods through corporate tax breaks, subsidies and by ignoring indirect societal and environmental costs.
Governments then worsen the situation by borrowing vast amounts of money to pay for these manipulations.
The veneer of corporate ethicality faced its coup de grace when the world shifted to a debt-based monetary system controlled by the small number of private international financiers running the federal reserve, the nucleus of a matrix of global banks that control world commerce.
A debt-based economy, in part, works like this: when governments need money they use their sovereign power to issue paper bonds (IOU’s) to the federal reserve banking system, which credits government accounts with the value of the bond.
Out of this account, the government pays creditors who then deposit that money into banks, who in turn, retail (lend) that deposited money out into the economy, repeatedly, in a process known as “creating money out of debt”.
The stability of this system is contingent on the economy (money supply) expanding faster than debt, so that interest payments on those paper IOU’s can be made.
Unfortunately expanding economies drive inflation, which reduces revenues, often requiring more IOU’s to pay for government services.
The absolute genius of debt-money is that it literally creates money out of nothing, it requires little to no liquidity base and it operates with impunity in our open loop debt-based economy.
Obscene wealth in the hands of a few, an eroding middle class, increasing poverty, a staggering debt crisis that has sealed our children’s future, increasing unemployment and escalating destruction of our environment has become the Occupy Movement’s rally cry against this economic chimera.
Retired Nanaimo resident Ron Heusen writes every second week. He can be reached through the News Bulletin at email@example.com.