Hickey and the Big Kahuna

Bernard Hickey should get together with Gareth Morgan; one has the daring, heretical call for the Reserve Bank to ‘print money’ (NZ Herald Feb 26) and the other maintains, shockingly, that we should all be paid a basic income.

And why not? There is no doubt that people on the lowest incomes are struggling to make ends meet. Overcrowding, Third World diseases, crime, domestic violence – all of these are symptoms of deepening poverty. They are exacerbated by the media: seeing what you don’t have and some else does only makes your situation seem worse. Publishing the Rich List rubs salt in the wounds of poverty.

Gareth Morgan recognises that not only would families benefit from a universal basic income, but their local business communities would too. And the envy of the ‘haves’ that the ‘have-nots’ are getting a handout would disappear, because everyone will get it.

But how to pay for it? Enter the heretical Mr Hickey. He has called for the publicly owned Reserve Bank to do the job it once did and ought to do now: create the money New Zealand needs to function, without resorting to borrowing from overseas banks at interest.

This is where the plan must depart from orthodox economics: no interest should be charged on this created credit being lent to the government. In this way, while enabling all New Zealanders to live in prosperity and dignity, and collecting the resulting taxes as money changes hands and strengthens communities, an eye could be kept on inflation as loans are paid down.

Democrats for social credit call for an independent Monetary Authority to manage this exchange, and keep control of the money supply, increasing or decreasing it as needed. It is generally accepted that such responsibility is too dangerous to leave in the hands of politicians.

So, Mr. Morgan, may I introduce Mr. Hickey? I think you have a lot to discuss.

Open letter to Gareth Morgan

To Gareth Morgan - millionaire, globe trotter and rational being.

Dear Mr. Morgan,

Congratulations on your independent study of the science surrounding climate change. You have shown yourself to be a truly rational being − that is, one who can, in the face of overwhelming evidence, change his mind.

You are also considered to be an expert on the economy, no doubt because you have been successful at making money within the current system. As a rational man, you might like to apply the same sort of objective investigation to the economic crisis as you applied to the environmental one.

Here are a few points I urge you to consider:
• The economy and the ecology are inextricably linked. It is tempting to think of climate change and other environmental problems as annoying, expensive distractions, but in reality they are central to our survival as a nation and a species.
• Einstein said “We cannot solve our problems with the same thinking we used when we created them.” This means that continuing with the present economic system is not rational.
• There is a direct correlation between “economic growth” and “carbon emissions” − the lines on a timeline graph are identical since the Industrial Revolution. The belief in unchecked “growth” as a valid method of economic recovery without considering the environmental cost is not rational.
• The effect of the current economic recession will be to put more and more wealth into fewer hands. The rest of us are increasingly relegated to debt slavery, unemployment and potential mass starvation, on a planet host that is rapidly being poisoned. This is not rational, even from the long−term point of view of the lucky few. Who will be left to buy their products and maintain their lifestyles? How will their obscene wealth help them when the seas engulf our coastal cities and arable land becomes desert?
• Are human beings doomed? As the most “successful” species the biosphere has had the misfortune to produce, will we self−destruct through an irrational belief in our right to consume no matter what the cost to our fellows and our planet host? Mother Earth, it should be noted, is not known for saving her dominant species. She will survive in spite of us.
• On a more positive note, it is well documented that human beings, having reached a level of comfort and prosperity that allows for happiness, do not increase their happiness quotient the richer they become beyond that level. In addition, humans who have reached that same economic level, are likely to produce fewer offspring, theoretically relieving the pressure on the planet’s resources. They are more likely to establish stable communities with high literacy, low crime rates and good health, all of which enhance economic performance. It is therefore rational to adopt an economic system that ensures the greatest number of people on the planet achieve this level of prosperity/happiness.
• Further to the last point, transferring wealth from the very rich to the poor through taxation has not been found effective in achieving the aforementioned prosperity/happiness. Widespread ownership, of homes, farms and small to medium businesses, has in the past delivered prosperity/happiness in many countries, yet we are increasingly going in the opposite direction: wage and debt slavery, disenfranchisement and misery for an increasing number globally, not to mention the destruction of our last remnants of virgin forest and other ecosystems.

Here are some books I urge you to read:
• How Many Lightbulbs Does It Take To Change A Planet? By Tony Juniper, 2007; published in Great Britain by Quercus.
• We Hold These Truths − The Hope of Monetary Reform by Richard C. Cook, 2008−09, published in the US by Tendril Press.
• Courage to Change, by Les Hunter, 2002, published in New Zealand by Harbourside Publications.
• Payback − Debt and the Shadow Side of Wealth by Margaret Atwood, 2008, published in London by Bloomsbury Publishing.

You, who are not subject to undue political influence, or distracted by the need to scratch a living for your family, are in a unique position to address this problem. Please, Mr. Morgan, apply your rational mind and your considerable resources to a study of the economy in the way you did for climate change. Find a way, right here in New Zealand, that we can change economic direction for the sake of all mankind and for our planet.