October 11, 2013
The
endless barrage of debt, debt, debt, makes debt-free money sound very
attractive. But the problem is not debt, it’s interest and interest-free
credit based money is superior to debt-free currency. On the other
hand, debt-free money could easily be repaired to again be a competitive
proposition.
Debt-free money is simply unbacked ‘paper’ (nowadays it’d be mostly
electronic, of course) money, printed (usually) by the State. It can
then either spend it into circulation itself or have the populace do it.
The former is commonly referred to as the Greenback, the latter is
known as Social Credit.
Interest-free credit is credit by bookkeeping. Not unlike our current fractional reserve banking system, although Mutual Credit is a simpler and superior way of creating credit, as there is no need for deposits (‘capitalization’). Hence Mutual Credit is intrinsically stable, while fractional reserve banking based lending facilities go bust routinely.
Debt-free money is spent into circulation and continues to circulate until it is retired through taxation. Interest-free credit is lent into circulation and is retired when the debt is repaid. Often the two meet. For instance: John Turmel recently gave the example of a Continental (George Washington’s debt-free money) being spent on infrastructure and retired through taxation covering the investment. In this way debt-free money is basically used as interest-free credit by the Government and the circulating Continental could be seen as the National Debt.
A noteworthy difference between interest-free credit and debt-free money is that interest-free credit can be spent as often as it is repaid, while debt-free money can only be spent once. This means interest-free credit is more flexible.
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Debt-free money is simply unbacked ‘paper’ (nowadays it’d be mostly
electronic, of course) money, printed (usually) by the State. It can
then either spend it into circulation itself or have the populace do it.
The former is commonly referred to as the Greenback, the latter is
known as Social Credit.Interest-free credit is credit by bookkeeping. Not unlike our current fractional reserve banking system, although Mutual Credit is a simpler and superior way of creating credit, as there is no need for deposits (‘capitalization’). Hence Mutual Credit is intrinsically stable, while fractional reserve banking based lending facilities go bust routinely.
Debt-free money is spent into circulation and continues to circulate until it is retired through taxation. Interest-free credit is lent into circulation and is retired when the debt is repaid. Often the two meet. For instance: John Turmel recently gave the example of a Continental (George Washington’s debt-free money) being spent on infrastructure and retired through taxation covering the investment. In this way debt-free money is basically used as interest-free credit by the Government and the circulating Continental could be seen as the National Debt.
A noteworthy difference between interest-free credit and debt-free money is that interest-free credit can be spent as often as it is repaid, while debt-free money can only be spent once. This means interest-free credit is more flexible.
Read More
