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The Steady-State Initiative

moving toward sustainability through economic reform

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Back to Basics

When society and the entire world economy is in a crisis situation as we are now witnessing, it is useful to get back to basics. This does not mean reverting back to functioning as primitive societies once did. This does not mean throwing out the baby with the bath water. It means re-examining how far removed we have gone from basics to a highly complex system that blinds us from the truth.

The basic requirement for all humans and society is to have the fundamental right to live in peace and with justice. That fundamental right means being able to provide food and shelter for our bodies. All of this comes from the planet that we live on. Thus, a direct consequence of this requires that we respect, preserve and protect the very Earth that we live on. It means that when we take from the earth, we must ensure that we leave the place in a better condition than what it was before, or we give the Earth the ability to regenerate and repair the damage that we leave behind. Anything less than this is clearly not sustainable.

Providing food and shelter for ourselves becomes an easier task when we share. By recognizing the benefits of specialization and division of labour, we are more efficient as a society when we share in mutual provision. The economy and current concept of money has led us astray.

Having said that, the exchange of money for goods and services is a more convenient and effective way to exchange rather than barter. This avoids the necessity for the double coincidence of wants.

When we become efficient at providing the basic needs for food and shelter, there comes the question as to what to do with the excess labour force. This is where our current pursuit of economic growth and financial wealth has led us astray. Our obsession with consumerism and perverse materialism for the purpose of keeping humans employed violates the fundamental principle of stewardship of the earth. Activities such as advancement of the arts and culture are both beneficial and sustainable. Furthermore, as a collective society, we need to re-examine the whole concept of work. We need to implement fewer working hours and more job sharing.

When we look around the world, we look in amazement at all the great buildings, monuments and structures that civilization has created, the Great Wall of China, the Egyptian pyramids, the Roman Colosseum, the Eiffel Tower, the Taj Mahal, the Sydney Opera House and so many more. We look at these wonderful achievements and try to imagine how much money was required to build these great things.

These were not created by money. These were created by human hands, blood and sweat. Of course, in more modern times, humans were assisted by powerful machines and abundant ancient energy. Money is only a fabric of society. Money is used to encourage, entice, persuade and coerce people to work cooperatively in creating these wonders. We say to people, do these tasks and you will be rewarded with money which will allow you to partake in the fruits of society.

In the same way, governments and corporations should re-examine why they are enticing their workers to labour. Governments should be providing more funding for education, healthcare, arts and culture. Governments and corporations should not be encouraging or financing workers to build more cars, to fill disposable plastic bottles with drinking water, or to brain-wash us with endless forms of advertising which encourage us to consume more stuff that we don't need.

Here is a basic understanding of our current monetary system and economy. The fundamental basis of the economy is all about trading, exchanging of goods and services between you and me - in other words, bartering or mutual provision. When we barter, we do something good for each other. We both benefit and we both come away happy. The difficulty with bartering is that we have to fulfill the double coincidence of wants, that is, you have something I need and I have something of equal value that you need. That is where money plays an important and vital role.

The problem begins when the money lenders, the bankers, extend a loan to you at interest. The principal amount of the loan now becomes a part of the money supply and may change hands many times. However, the interest amount which does not yet exist, must still be repaid to the bank. This comes from someone else who has to take out a new loan to cover the interest. This goes on forever in a diminishing geometric series.

To compound the problem, banks can lend as much money as they please. They create money simply by extending credit to you, me and anyone that wants a loan. Why do banks do this? Because it makes the bankers wealthier. Thus the easy credit, plus the interest obligations, require more loans to be created. For this pyramid scheme to go on unchecked, you need to create a growing market, growing economy and growing population. This is why all mainstream economists, financiers and governments cannot entertain anything less than a growing economy.

As if that were not enough, two other sinister things are at work. The first thing is that as the money supply expands to fuel the growing economy, those with the wealth are adept at attracting more wealth. Thus the gap between the rich and the poor widens. This is manifested in the exploitation of the poor and working class by the wealthy.

The second thing that has happened and continues to this day is that the wealthy has gained control of the national and global monetary system by creating the Federal Reserve, the International Monetary Fund (IMF), the World Bank and other financial institutions. These privately owned institutions control national governments, subvert democracy and destroy nationstates and local economies. All of this amounts to modern day slavery.



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