Path to a Peace Economy
2. Create a Real Wealth Money System: Last night Don Shaffer spoke of redirecting the flow of money from global to local financial markets and moving from complex, opaque, anonymous, short-term financial relationships to direct, transparent, personal, and long-term financial relationships. This defines our charge for redesigning and restructuring our systems of money creation and allocation.
Our existing Wall Street financial system centralizes the power to create and allocate money in an interlinked institutional system of mega-banks, hedge funds, private equity funds, the Federal Reserve, and captive regulatory bodies operating in secret beyond public oversight and accountability that I earlier described as a criminal syndicate.
The Bush and Obama administrations both pumped literally trillions of dollars of bailout money into the corrupt Wall Street financial institutions responsible for the current economic mess. Note here the essential difference between the bailout money and the Obama stimulus money. Bailout money goes to Wall Street financial institutions in the hope that some of it will trickle down to Main Street in the form of loans. Stimulus money bypasses Wall Street and directly funds the creation of productive jobs to create beneficial goods, services, and public infrastructure projects.
So imagine that instead of a bailout for the corrupt banks that caused the crash, the government had taken them over, broken them up, and spun off the pieces as individual community-based financial institutions—community banks, savings and loans, and credit unions. Some might be organized as private for-profits. Others as nonprofits or cooperatives. Some might be owned by state or local governments. All would function as properly regulated, community accountable public utilities.
Now imagine that the trillions of dollars that went to bailing out Wall Street banks had instead been added to the stimulus package to directly help homeowners facing foreclosure, create new jobs, and to fund education, health care, and public infrastructure. Further, imagine that the recipients of the stimulus money then deposited a portion of it as savings in these community financial institutions to be continuously recycled as low interest or no interest loans to grow local businesses, expand home ownership, and finance public investment. How different things might now be.
Here is a really radical idea: Let’s federalize the Federal Reserve and make money supply management and banking oversight transparent and publicly accountable federal functions. Why should the federal government borrow and pay interest on money created with an accounting entry by private banks, thus condemning our children to perpetual debt slavery to private banks and foreign countries, when it is within the means of the government to make the accounting entry itself?
3. Share the Wealth: As noted earlier, we all do better when we share the wealth. So let’s do it with:
- Income and employment policies that assure every person who needs employment access to employment that provides a living wage.
- Progressive taxation and public services policies that continuously recycle wealth from those at the top who have more than they need to those at the bottom who have less than they need.
- Land use and regional development policies that limit sprawl and support compact multi-strata development that prevents geographical division by class and race.
Ownership policies that eliminate the class divide between owners and workers by encouraging every owning person to do productive work and every working person to be an owner.
4. Favor Businesses Organized as Living Enterprises for which the primary business purpose is to serve the community and profit is a means, not an end. Cooperative, worker, and local public ownership models sensibly and appropriately link business interests to community interests. We can and should make them our favored enterprise models.
5. Change the Global Rules to Support Local Control and Regional Self-Reliance: Current global economy rules and institutions that put the economic rights of global financiers and corporations ahead of the economic rights of ordinary people, place-based communities, and even nations. They have it backwards. The rules and institutions of living peace economies properly support democratic self-determination at local, regional, and national levels, keep trade fair and balanced, favor local over global businesses, and facilitate the sharing of information and beneficial technology.
The goal is to shift the economic system’s defining value from money to life, its locus of economic decision making from global to local institutions, its favored dynamic from competition to cooperation, and its primary purpose from growing the individual financial fortunes of the few to building living community wealth to secure the health and well-being of everyone. It is ours to so choose and create.
How to Engage
You will find further information on everything I’ve covered here in Agenda for a New Economy. Buy a copy, download a discussion guide from davidkorten.org, and organize a discussion group to engage your friends, colleagues, and neighbors in an exploration of the new economy alternatives.
People are always asking, “What else can I do?” I recommend YES! Magazine as the place to start. Each issue is filled with stories of possibility and ideas for action. Visit the “Path to a New Economy” section of the YES! website.
Part of growing up human is putting aside the ways of our childhood to embrace the more inclusive values and responsibilities of adulthood. Our time has come to grow up as a species coming of age on a small planet. This is the larger challenge before us. In a very real sense, it is about growing up spiritually to recognize and accept our place within the larger scheme of creation.
As we engage this challenging work in its many dimensions, we must constantly remind ourselves that we are privileged to live at the most dangerous—but also the most exciting—moment of creative opportunity in the whole of the human experience. We have the power to turn this world around for the sake of ourselves, our children for generations to come, and the continued creative unfolding of life on Earth. We are the ones we’ve been waiting for. Thank you.
David Korten is co-founder and board chair of YES! Magazine. His most recent book is Agenda for a New Economy: From Phantom Wealth to Real Wealth. He presented this speech on October 19, 2009 during a keynote lecture at the Economics of Peace Conference in Sonoma, California.
Interested? David Korten reads from Agenda for a New Economy
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