Young people expose money creation myth


An Open Letter to the Dean of SBE and all Economics Professors at Maastricht University (UM)

Young people are increasingly stepping up to demand systemic change on many fronts — not just ecological but economic.

Here, it’s economic students blowing a hole into arguably THE greatest financial myth of all time — that banking corporations only lend money that they have. Total and complete BS. They create it out of thin air as debt. Why does this matter? When you add the fact that most money creation in our society originates from financial institutions as debt and that corporate money creation is THE greatest example of corporatization/ privatization in our society (a mammoth corporate coup since Art 1, Sec 8 of the U.S. Constitution gives Congress the power to coin money), what we have is a political and financial system controlled by financial corporations.

We’re all in debt to financial corporations — individuals, governments, even non-financial corporations. That means we’re all serfs to financial institutions. Even if you personally have no debt, a portion of everything you buy is priced to account for the debt of the producer.

Democratizing our money system goes hand-in-hand with democratizing our political system and Constitution. Good luck trying to having a real political democracy when banking corporations can create money out of nothing and convert their financial power into political power. The FIRE (Finance, Insurance, Real Estate) industry remains #1 in legalized bribery (political donations) and right up there in lobbying. It’s been this way (sometimes dropping all the way down to #2) for a long time.

It’s also is directly connected to saving the planet. How? Under the current debt-based corporate money system, the only way to collectively to pay off debt (not just the principle, but interest — which wasn’t created by financial corporations) is to race and compete with one another in a system where there isn’t enough money to pay off our loans. We must race as fast as possible to earn as much as we can in competition with others, which for many in our economy means working at jobs which convert natural resources into stuff that can be sold/consumed as quickly as possible, which of course results in massive amounts of ecological “externalities” (trash, garbage, pollution). We absolutely MUST plunder the planet to collectively pay off our debts. Of course, it’s in the end a losing proposition for the losers of this race. The result — like addicts, more debt to pay off past debt (which of course means more interest payments due which weren’t created). It’s why we have cyclical financial bubbles and bursts of those bubbles when people/governments/non-financial corporations see more of their debt payments going to pay just the interest.

We’re now in the midst of the mother of all bubbles (what some call “the everything bubble” — the bursting of which in the next year or two will be devastating.

The alternative is publicly-created debt-free and inflation-free money. WE decide how much is created and where it should be spent, not financial corporations. Human and physical infrastructure is the priority. It’s how to fund any real Green New Deal. It’s what the NEED Act of a few years ago was all about.

Of course, we don’t have the people power to force the end of the banking coup of money creation. That must be the first step. And that’s where the #WethePeopleAmendment sponsored by #MovetoAmendcomes in. We have to take charge of our political system.

It won’t be easy.

The Second National Bank of the U.S. threatened to cause a financial depression (by calling in all their loans) when their corporate charter was not going to be renewed in the 1830’s. Cleveland’s banks threatened default of the city (and followed through) when then Mayor Dennis Kucinich refused to sell the city’s public electrical utility to CEI, the private electric utility (tied to the banks). By the way, Kucinich was the main sponsor of the NEED Act when in Congress. He gets it. We must too.

Financial corporations have the most to lose to democratize our political and monetary systems. They will both push (lobbying and political investments/contributions) and pull (call in loans) as means to disrupt, demean and distract.

What choice to we have?

NEOhio AFSC September 23, 2016 Podcast


Listen to Podcast here

We summarize last week’s activities; share next week’s upcoming events; and comment on efforts to reign in PayDay lending corporations, the recent and sudden investments of billionaires, and how the decision this week by the Federal Reserve not to raise interest rates effects all of us (Length 39:15).

Getting serious about solving wealth inequality

We can’t seriously address income and wealth inequality if the only democratic tool we use are tax policies. We simply can’t ignore monetary policies — the creation and circulation of our own money.

Currently, the vast majority (estimated as high as 97%) of our money is created not by our government — as authorized in the Constitution (Art 1, Sec 8 giving Congress the power to coin, or create money) — but by private financial corporations. It is the penultimate privatization/corporatization of any public assets.

Worse, the financial corporations create this money via loans — meaning money is created as debt, which of course must be paid back at interest.

There are numerous economic…not to mention political…problems with this scam. One of the problems is its contribution to inequality. As the above image from Positive Money in the UK describes, each time a person pays the interest to the financial institution is each time wealth is transferred from the bottom to the top. Ten percent of the population benefit from this set up, 90% gets stiffed. Inequality is built into our monetary system.

There are numerous worthy proposals to address inequality through tax measures. A new report issued just this week, “Billionaire Bonanza: The Forbes 400 and the Rest of Us” by the Institute for Policy Studies, is the latest example. The report, which documents that the richest 20 people in the US own more than the bottom half of all Americans (i.e. 152 million people), presents several recommended tax changes. These include closing various tax loopholes and increased direct taxes on wealth, not just income.

Instituting these tax changes would certainly provide an economic relief to the majority of people and to society as a whole. Failing to change the design of our monetary system, however, guarantees that inequality via interest payment on bank loans will continue.

Our money should be conceived of as a public utility. It should be publicly created and determined publicly how it is spent — as an asset, not a loan/debt.

There are proposals to end the ability of banks to create money as debt. Just as we educate ourselves on the nuances of tax policies, it’s time to get serious about monetary literacy. That’s the only way we can get serious about solving wealth inequality.

NEO AFSC November 20, 2015 Podcast


Listen to podcast here

We summarize last week’s activities; share upcoming events for next week; and comment on how corporations profit from war, how the Trans-Pacific Partnership may be in trouble, and how rising inequality will widen and lead to social disorder if we don’t change the way money is created and distributed.

Response to PD OpEd, “Let’s debate getting our fiscal house in order”


Let’s debate getting our fiscal house in order: Sandy Cutler and Maya MacGuineas (Opinion)


This was my posting at the end of yesterday’s opinion piece on…

Why is it they everyone who talks about the debt only considers spending and/or tax policies as possible alternatives?  There is an entire third arena that is constantly ignored: monetary policy. Namely, the power and authority of government to create its own debt-free and inflation-free money. This is, incidentally, what the father of the Republican Party, Abraham Lincoln, did in the 1860’s when “Greenbacks” were printed and circulated. Rather than be fleeced by bankers and their incredible interest rates, Lincoln simply encouraged what the US Constitution (Art 1, Sec 8) empowers and authorizes Congress to do: “to coin Money.” That means to print. Not banks (which create the vast quantity of our nation’s money as debt). Not the bankers bank — the Federal Reserve. But, rather, our government.

US money created for productive purposes (vs speculating — which banks are masters at doing — leading to perpetual booms and busts) is not inflationary. Many top global economists have documented this.

We need Sovereign money. Democratic money. That is exactly the plan of the National Emergency Employment Defense (NEED) Act, which was introduced in the last Congress. A political independent publicly accountable body would determine the quantity of money needing to be created and Congress, like now, would decide how to spend it. The plan is at

The NEED Act would make the largely private and misnamed Federal Reserve system accountable to the public, not their investors (all banking corporations); end the ability of banks to create money out of thin air and leverage their loans (called “fractional reserve lending”); and create several trillion dollars hiring millions of people to repair our nation’s infrastructure. Federal bonds, bills and notes would be redeemed when they came due with US money — thereby overtime ending the anti-democratic addiction of debt and dependency to creditors. It also could reduce overtime taxes.

Republican candidates for President in Cleveland should be asked whether they support creation of a new “Greenback” program similar to their party’s founder, Abe Lincoln, as a means to reduce the national debt, increase jobs, repair our nation’s infrastructure (mandatory for any economic expansion), reduce the economic and political power of banks (the #1 sector contributor/investor in federal elections) AND to expand democracy?

I would love to hear their responses.

Using the Public Power to Create Money to Create Jobs, Repair Infrastructure & Reduce Debt

Audio of AFSC Monthly Conference Call Conversation


Speaker: Joe Bongiovanni — Co-Director of the Kettle Pond Institute, second generation monetary reformer, annual speaker at the American Monetary Institute national conference.

Joe discussed the topics of money and how it’s created by banking corporations, how monetary policy connects to the economy and our lives, and why it’s important to become monetarily literate, He talks and answers questions about the National Emergency Employment Defense (NEED) Act, which if enacted would infuse debt-free money into our economy to meet our basic physical and human needs, create jobs and reduce our national debt.

High school course on democratizing money creation


Boy do I wish I had been exposed to this in 12th grade…however, it’s never too late to become monetarily literate. it’s imperative to try to get on the other side of the learning curve ahead of the next soon-to-come (and much more severe) economic collapse — to understand and counter the PR blather that will be rolled out by the power elite and be in a position to offer and organize around fundamental change to democratize money creation.


“Without knowing how money is created and managed, all other topics concerning money are out of context. This is crucial: regarding trillions of dollars of economic power, you have no idea where money comes from.”

“When you understand the power of creating credit out of nothing, your mind will eventually take the next logical step and ask: why don’t we create money out of nothing to pay for public goods and services directly rather than surrender this awesome power to the banks? You’ll wonder: why doesn’t government create money to hire unemployed workers for all the infrastructure work that needs to be done?”

Debt-damned economics: either learn monetary reform, or kiss your assets goodbye