Oh yay! I did the obvious and clicked on your stack to go to the article. Thank you for featuring my plan here and with such a lovely picture of fine, healthy carrots!
I'll respond to some of your points and questions here and link to your article in my episode. So happy you want to keep the discussion going!
My book gives a lot of the background on the current economic system that I couldn't include in my article. One book it cites is The Two-Income Trap by Elizabeth Warren and her daughter. It talks about the over-consumption myth that people are buying McMansions and spending more on unnecessary stuff. It shows that people spend less of their income on food, clothes, and stuff than 50 years ago. We buy new cars less often. We live in fewer square feet per person but pay a far greater proportion of our income for it. Most of our income goes to what I call the Unaffordable 4H: Housing, Healthcare, Higher Education and Hope for Retirement. Universities have gone up 700%. Most bankruptcies are from medical expenses, not consumer purchases.
But as it says in the title, two incomes were a trap. We bid against others with as much debt as we can afford for the same house. If you're bidding with two incomes, you'll get the house. For my parents, women rarely worked outside the home. I was able to do that because I bought my home 40 yrs ago (before I met my husband) and never sold, as you recommend. But unless they live in my house, my daughters will never have that choice. Two incomes are the norm in the housing market.
Another important thing to understand is that since the Federal Reserve Act, the Federal Government doesn't have the right to issue credit or bills of currency. The Constitution, when it says that only the Federal Government can issue coins, has been legally rendered literally. That's why your dollar bills say Federal Reserve Note and not US Treasury Note. The Constitution was written to prevent states from issuing their own currency but it ended up preventing it when usurped by the bankers.
So that's why the right of seignorage is the last loophole for money not borrowed from the central bankers. The Federal Government (it burns me that they even stole the short version of Fed) can issue coins and give them any value it wants. So it could print three platinum coins, give them the fiat value of a trillion dollars each, and use them to replace the Social Security Trust Fund, issuing $9000 per person as capital to each commonwealth bank. This is also a bribe to the gov't because the trust fund has been a slush fund so they don't have it to give back. This plan saves their bacon ;-)
Social Security is a beautifully designed system and I'd put Frances Perkins on those platinum coins. It just needs to be fulfilled at what was promised to participants when they put the money in. Commonwealths would be collecting the tax and investing the trust fund in their own mortgage-backed bank, so they just need to make sure they're distributing benefits. In my own fiefdom, there's only one thing I'd change. I'd up the maximum for a married couple, even if it came out of one income, and I'd divide the benefit equally whether still married or divorced. Currently the non-working spouse gets half of what the working spouse does and it maxes out at full retirement age. Since the non-working spouse is typically more involved with the kids, that doesn't make sense to me whether they stay married or not.
As the interest on the SS Trust Fund builds up, I think I'd look at lowering retirement age back down to 65 and late retirement to 68. But I'd save that as a reward for when the system's working!
Right now 97% of money is created through mortgages. But with 5.3% interest, 194% of that money is being spent on real estate because double that amount needs to go back. That's why inflation is built in. Under my system, the carets to pay it back are generated monthly but it can't be used for that without being earned from someone else. As a targeted dividend, it needs to create at least one exchange of goods or services before it can be used to pay the rent or mortgage--which is how it differs from just distributing it as UBI.
And yes! When people exchange dollars for carets, it goes into the commonwealth cash reserves. So let's say that you let people who earn dollars to do a 1:1 exchange up to $3000 per month to spend tax-free on housing, local services and goods. The $3000 can then allow ^6000 carets to be issued as dividends in the commonwealth, because they could only be cashed out with half going to tax. So the dollars coming in benefit everyone.
Glad you appreciate the maximum wage! And it's Ben Franklin, whose system mine is based on, who thought that 5% was the right interest on a house and 3% to finance one already paid off (an equity loan in today's jargon). Thank you for being in my brainstorming thinktank, John!
A couple quick questions (life has many demands!):
If a person can buy carets with dollars, then can they exchange carets for dollars? If carets are tied to the dollar then the entire caret system would be at the mercy of exchange rates and inflation in the "imperial" (dollar) money.
It also sounds like carets are another form of fiat money. Nothing really backing them.
Hello, John. Did you see the episode on this conversation? My internet went down when I tried to post my reply so I recorded the video with the reply in it, and then posted it and my reply at the same time.
When you raise objections to my plan, you should clarify what your plan is and why it meets the goal better than mine. My goal is for communities to control their own labor without debt to the bankers or taxes to the govt, by being the default owner of the properties within their borders and having the exclusive right to issue credit against them.
So you would be setting both the exchange rate for dollars to carets in your commonwealth model (to be run against a simulation before it's enacted) and the tax rate for exchanging carets to dollars.
If you choose to have a 1:1 exchange rate, then outside developers and landlords can buy up properties at the same level as commoners, driving prices up. Maybe that's not a problem for your town. But even in my hometown of Cumberland, where prices are cheap, out of town slumlords snap up houses on property tax foreclosure auctions and rent them to Sec 8 recipients from Baltimore and DC, who can't afford to live there. So there are a lot of drug and welfare cases that are imported instead of taking care of the people who already live here and also need help.
In Santa Cruz, we're currently being bombarded with huge developer schemes for high-rise pack 'n stack housing. When they're built, all of them will be extracting as much rent out of SC as possible from the students and tourists they cram in to 288 sq ' apts. So if carets could be exchanged 1:1 for dollars, all of it would bleed out to the int'l hedge funds and blackrock subsidiaries who own them.
Again, you control the exchange rate. If the dollar inflates, you can change it to 3:1, 4:1 etc. Also if you set your caret:dollars at 1:1, your producers will compete with the cheapest products on the market from Costco, etc.
As I also asked William and Nefahotep, explain to me what isn't fiat money? If you're trading gold and silver in its actual form at its use value, then yes, that's not fiat. If you're trading at an artificial rate set by its speculative value and controlled by those who own the vast majority, it's just another fiat. And its production involves killing off whole communities with paramilitaries who do horribly violent things that I could describe, if you're interested, and poisoning the water with arsenic that stunts the growth of children. Not good karma.
The caret is modeled after Ben Franklin's scrip, which he called land-backed money that couldn't be exported. The money is backed by the real estate within your borders. It's backed by the most healthy and constructive, solid and useful production on earth. What's your's backed by?
But I don't mean that to be snippy, I am glad you're continuing the discussion. But the default is the way things are now so, if you don't like that, put your own rooster in the ring.
When possible I like to avoid making "excuses", but I do have to ask that you be patient as I was out of state for the past three days and work demands my attention too.
This is when I wish I was "retired" so I had more time to dive into rabbit holes and explore ideas.
I just watched your episode on this conversation. It deserves some thought and contemplation. {smile}
Oh I'm so sorry John. I knew when I wrote that it wasn't going to have the tone of voice that it did in my head. It was supposed to be a question and not a demand ;-) There was no reason you should have watched it, I just didn't know if I was being redundant.
If you were retired, you'd just find more rabbit holes to jump into ... trust me on this. And thanks for watching my episode! And for saying it deserves thought and contemplation. Music to my ears.
This is all good! Conversation and discussion is valuable and is of interest to me. You might have noticed that I managed to find some time to write another article addressing some of your comments.
Hahaha, now you can turn that back on me! I didn't notice. My email is squirrelly and sends some subs into junk mail while others sail through just fine. I'll check it out now and thanks!
Definitely some interesting thoughts.
Oh yay! I did the obvious and clicked on your stack to go to the article. Thank you for featuring my plan here and with such a lovely picture of fine, healthy carrots!
I'll respond to some of your points and questions here and link to your article in my episode. So happy you want to keep the discussion going!
My book gives a lot of the background on the current economic system that I couldn't include in my article. One book it cites is The Two-Income Trap by Elizabeth Warren and her daughter. It talks about the over-consumption myth that people are buying McMansions and spending more on unnecessary stuff. It shows that people spend less of their income on food, clothes, and stuff than 50 years ago. We buy new cars less often. We live in fewer square feet per person but pay a far greater proportion of our income for it. Most of our income goes to what I call the Unaffordable 4H: Housing, Healthcare, Higher Education and Hope for Retirement. Universities have gone up 700%. Most bankruptcies are from medical expenses, not consumer purchases.
But as it says in the title, two incomes were a trap. We bid against others with as much debt as we can afford for the same house. If you're bidding with two incomes, you'll get the house. For my parents, women rarely worked outside the home. I was able to do that because I bought my home 40 yrs ago (before I met my husband) and never sold, as you recommend. But unless they live in my house, my daughters will never have that choice. Two incomes are the norm in the housing market.
Another important thing to understand is that since the Federal Reserve Act, the Federal Government doesn't have the right to issue credit or bills of currency. The Constitution, when it says that only the Federal Government can issue coins, has been legally rendered literally. That's why your dollar bills say Federal Reserve Note and not US Treasury Note. The Constitution was written to prevent states from issuing their own currency but it ended up preventing it when usurped by the bankers.
So that's why the right of seignorage is the last loophole for money not borrowed from the central bankers. The Federal Government (it burns me that they even stole the short version of Fed) can issue coins and give them any value it wants. So it could print three platinum coins, give them the fiat value of a trillion dollars each, and use them to replace the Social Security Trust Fund, issuing $9000 per person as capital to each commonwealth bank. This is also a bribe to the gov't because the trust fund has been a slush fund so they don't have it to give back. This plan saves their bacon ;-)
Social Security is a beautifully designed system and I'd put Frances Perkins on those platinum coins. It just needs to be fulfilled at what was promised to participants when they put the money in. Commonwealths would be collecting the tax and investing the trust fund in their own mortgage-backed bank, so they just need to make sure they're distributing benefits. In my own fiefdom, there's only one thing I'd change. I'd up the maximum for a married couple, even if it came out of one income, and I'd divide the benefit equally whether still married or divorced. Currently the non-working spouse gets half of what the working spouse does and it maxes out at full retirement age. Since the non-working spouse is typically more involved with the kids, that doesn't make sense to me whether they stay married or not.
As the interest on the SS Trust Fund builds up, I think I'd look at lowering retirement age back down to 65 and late retirement to 68. But I'd save that as a reward for when the system's working!
Right now 97% of money is created through mortgages. But with 5.3% interest, 194% of that money is being spent on real estate because double that amount needs to go back. That's why inflation is built in. Under my system, the carets to pay it back are generated monthly but it can't be used for that without being earned from someone else. As a targeted dividend, it needs to create at least one exchange of goods or services before it can be used to pay the rent or mortgage--which is how it differs from just distributing it as UBI.
And yes! When people exchange dollars for carets, it goes into the commonwealth cash reserves. So let's say that you let people who earn dollars to do a 1:1 exchange up to $3000 per month to spend tax-free on housing, local services and goods. The $3000 can then allow ^6000 carets to be issued as dividends in the commonwealth, because they could only be cashed out with half going to tax. So the dollars coming in benefit everyone.
Glad you appreciate the maximum wage! And it's Ben Franklin, whose system mine is based on, who thought that 5% was the right interest on a house and 3% to finance one already paid off (an equity loan in today's jargon). Thank you for being in my brainstorming thinktank, John!
A couple quick questions (life has many demands!):
If a person can buy carets with dollars, then can they exchange carets for dollars? If carets are tied to the dollar then the entire caret system would be at the mercy of exchange rates and inflation in the "imperial" (dollar) money.
It also sounds like carets are another form of fiat money. Nothing really backing them.
Hello, John. Did you see the episode on this conversation? My internet went down when I tried to post my reply so I recorded the video with the reply in it, and then posted it and my reply at the same time.
When you raise objections to my plan, you should clarify what your plan is and why it meets the goal better than mine. My goal is for communities to control their own labor without debt to the bankers or taxes to the govt, by being the default owner of the properties within their borders and having the exclusive right to issue credit against them.
So you would be setting both the exchange rate for dollars to carets in your commonwealth model (to be run against a simulation before it's enacted) and the tax rate for exchanging carets to dollars.
If you choose to have a 1:1 exchange rate, then outside developers and landlords can buy up properties at the same level as commoners, driving prices up. Maybe that's not a problem for your town. But even in my hometown of Cumberland, where prices are cheap, out of town slumlords snap up houses on property tax foreclosure auctions and rent them to Sec 8 recipients from Baltimore and DC, who can't afford to live there. So there are a lot of drug and welfare cases that are imported instead of taking care of the people who already live here and also need help.
In Santa Cruz, we're currently being bombarded with huge developer schemes for high-rise pack 'n stack housing. When they're built, all of them will be extracting as much rent out of SC as possible from the students and tourists they cram in to 288 sq ' apts. So if carets could be exchanged 1:1 for dollars, all of it would bleed out to the int'l hedge funds and blackrock subsidiaries who own them.
Again, you control the exchange rate. If the dollar inflates, you can change it to 3:1, 4:1 etc. Also if you set your caret:dollars at 1:1, your producers will compete with the cheapest products on the market from Costco, etc.
As I also asked William and Nefahotep, explain to me what isn't fiat money? If you're trading gold and silver in its actual form at its use value, then yes, that's not fiat. If you're trading at an artificial rate set by its speculative value and controlled by those who own the vast majority, it's just another fiat. And its production involves killing off whole communities with paramilitaries who do horribly violent things that I could describe, if you're interested, and poisoning the water with arsenic that stunts the growth of children. Not good karma.
The caret is modeled after Ben Franklin's scrip, which he called land-backed money that couldn't be exported. The money is backed by the real estate within your borders. It's backed by the most healthy and constructive, solid and useful production on earth. What's your's backed by?
But I don't mean that to be snippy, I am glad you're continuing the discussion. But the default is the way things are now so, if you don't like that, put your own rooster in the ring.
When possible I like to avoid making "excuses", but I do have to ask that you be patient as I was out of state for the past three days and work demands my attention too.
This is when I wish I was "retired" so I had more time to dive into rabbit holes and explore ideas.
I just watched your episode on this conversation. It deserves some thought and contemplation. {smile}
Oh I'm so sorry John. I knew when I wrote that it wasn't going to have the tone of voice that it did in my head. It was supposed to be a question and not a demand ;-) There was no reason you should have watched it, I just didn't know if I was being redundant.
If you were retired, you'd just find more rabbit holes to jump into ... trust me on this. And thanks for watching my episode! And for saying it deserves thought and contemplation. Music to my ears.
This is all good! Conversation and discussion is valuable and is of interest to me. You might have noticed that I managed to find some time to write another article addressing some of your comments.
Hahaha, now you can turn that back on me! I didn't notice. My email is squirrelly and sends some subs into junk mail while others sail through just fine. I'll check it out now and thanks!