Transcript public money initiative - Monetary Reform Task Force

HYBRID
PUBLIC MONEY
INITIATIVE
MONETARY REFORM TASK FORCE
http://www.monetaryreform-taskforce.webs.com
Ronald E Davis, PhD
About the Presenter
• Born in Oklahoma in 1945
• Attended Harvard College 1963-1967, Magna Cum Laude in Applied Math
• Attended Stanford University for MS and PhD in 1980 in Mathematics
• 10 years industrial experience in applications of Management Science
• 30 years teaching experience in Management Science at SJSU
• Self taught in the Federal Reserve System and monetary reform since 1975
"Give me control of a nation's money (supply)
and I care not who makes the laws."
• Mayer Amschel Rothschild
[Mayer Amschel Bauer] (1744 -1812), Godfather of the Rothschild Banking
Cartel of Europe
• Source:
• 'The Creature from Jekyll Island' (American Opinion Publishing), p. 218
Quotes attributed to Thomas Jefferson
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“I believe that banking institutions are more dangerous to our liberties than
standing armies. Already they have raised a money aristocracy that has set the
Government at defiance. The issuing power should be taken from the banks and
restored to the people to whom it properly belongs.”
“If the American people ever allow private banks to control the issue of currency,
first by inflation, then by deflation, the banks and the corporations that will grow
up around them will deprive the people of all property until their children will wake
up homeless on the continent their fathers conquered.”
Federal Reserve System
December 23, 1913
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Conceived and first draft written in a secret meeting at a JP Morgan estate on Jekyll Island,
Georgia in November 1910 attended by bankers, an economist, and Senator Nelson Aldrich
Created a two-tier system of money creation
Federal Reserve Banks (privately owned) create monetary base when they buy government
bonds and securities which become “reserves” for the commercial banks
Commercial Banks (privately owned) create bank credit when they make loans based on
the fractional reserve system
Entire money supply (excepting coins and a few left over US Notes) issued on the basis of
debt
National Debt History
1940 - present
Value (buying power) of the Dollar
since 1913
The Money Trust
What a funny little government
Breaking through the wooden floor
The Vultures’ Roost
The Protectors of our Industries
The Bosses of the Senate
WHAT IS PUBLIC MONEY?
• Money in the form of coins, paper money (US Notes), or electronic bank
account credits, that is created by the federal government’s Treasury
Department WITHOUT DEBT or INTEREST OBLIGATION, and either lent or
spent into circulation
Historical Examples in US History
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Federal and State issued Continentals funded the Revolutionary War
US Notes funded the Civil War (three $150 Million authorizations)
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Legal Tender Acts of February 1862, mid-year 1862, and February 1863
Hepburn v Griswold case of 1870 ruled US Notes unconstitutional, however
Knox v. Lee case of 1871
ruled US Notes constitutional and
Parker v. Davis case of 1871
ruled US Notes constitutional and
Julliard v. Greenman case of 1884 ruled US Notes constitutional
US Notes circulated as paper legal tender without problem for over 100 years
REAL OUTPUT STANDARD FOR MONEY
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The backing for government created money is the goods and services exchanged in
the macro economy, that is, the REAL OUTPUT of the economy;
Inflation control is maintained by regulating money supply growth to the growth of
the real output of the economy so that prices remain stable, thus preserving the
value of the dollar
The phrase “sound money” used to mean money that is convertible into gold or
silver coins; in modern times, it means that the money creation process is subject
to scientific control laws that serve to preserve the purchasing power value of the
money over the long term
THE FALSE DICHOTOMY
• Choose between Private Bank Created Money (FED money), or
• 100% Public Money (AMI NEED Act)
• IT’S ONE OR THE OTHER!
THE HYBRID PUBLIC MONEY SOLUTION
• Create a PUBLIC-PRIVATE PARTNERSHIP in which
• Monetary Base is created debt-free by the government (Treasury Dept)
• Commercial Bank Credit is created as interest-bearing debt through loans
by private banks, based on the fractional reserve system
• No change in the FED except that monetary base is created debt-free by the
Treasury Department rather than through debt-based bond purchases by
the FED
THE BLOOD TRANSFUSION ANALOGY
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Money in the economy is like blood in the body; there is a certain amount of it, which has to be
kept in proper proportion to the size of the body (economy) in which it circulates;
Money flows in one direction while goods and services flow in the opposite direction;
As new Public Money is created and spent into existence by the government, debt based money
is retired as loans are paid off and not rolled over;
The rate at which new Public Money enters the economy must be balanced with the rate at
which old Private Money leaves the economy;
The optimal blend of private versus public money remains to be determined, and is approached
by a gradual increase in the public percentage and a gradual decrease in the private percentage
THE HYBRID PUBLIC MONEY ACT of 2017
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Title 1: Governmental Money Creation Powers
Title 2: Monetary Creation and Control Authority
Title 3: Funding for GDP boosting projects (infrastructure, technology, training)
Title 4: Deficit Reduction and cancellation of Budget Sequestration
Title 5: Debt Reduction via elimination of Intragovernmental Debt
Title 6: The Office of Full Employment
Title 7: The office of Poverty Alleviation
Title 8: The Office of Conflict Resolution
Title 9: Periodic partial audits of the Federal Reserve System
Title 10: Monetary History Documentary productions
TITLE 1:
Governmental Money Creation Powers
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Congress delegates its power to create government money to the newly created
Monetary Creation and Control Authority, per Title 2 of this act
The MCCA has power to authorize the Treasury Department to create money in all
three forms: coins, paper bills (US Notes), and Electronic Public Money (EPM)
Money created by the government shall come into existence without debt or
interest obligation, and shall be treated as income to the US Treasury account that
runs in parallel to and is mingled with tax revenues.
Money authorized by the MCCA and created by the Treasury Department may be
lent or spent into circulation for purposes enumerated in the federal budget
TITLE 2:
Monetary Creation and Control Authority
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An independent, permanent commission of experts, appointed by the President and confirmed by the Senate,
augmented by numerous ex-officio members from Congress, the Executive branch, and the Federal Reserve System
The main purpose of this body is INFLATION CONTROL (i.e. regulating the rate of monetary creation authorized for the
Treasury Department)
Review and approve full or partial EPM funding for GDP boosting projects
Review and approve full or partial EPM funding for Full Employment, Poverty Alleviation, and Conflict Resolution projects
Collect and extend the best macroeconomic models by incorporating an Inflation Prevention Inequality in them
Fund creation of a new continuous time low dimensional stochastic dynamic control (NASA engineering) model of the
macro economy for predicting and analyzing the impacts of monetary control variables on growth, employment, and
inflation
Prepare targets and forecasts of monetary aggregates and monetary base reserve requirements
TITLE 3:
Funding for GDP boosting projects
• The MCCA shall evaluate and prioritize GDP boosting project proposals for
EPM funding in the following areas, up to $1 trillion per year for four years
• Evaluate and prioritize infrastructure projects
• Evaluate and prioritize job training projects
• Evaluate and prioritize production technology enhancement projects
• Prioritization shall include consideration of GDP Impact Multipliers as a
means of inflation control
TITLE 4:
Deficit Reduction for Budget Sequestration
Cancellation
• Effect monetary transfusion by replacing Federal Reserve base money with
EPM as Treasury securities in the FED portfolio are redeemed when they
mature;
• Since this component of the national debt does not need to be rolled over,
this is deficit reduction of sufficient magnitude to cancel the Budget
Sequestration that went into effect March 2013 under the Budget Control
Act of 2011
TITLE 5:
Debt Reduction via repayment of
Intragovernmental Debts
• EPM shall be created to make monthly installments on all
Intragovernmental Debts to be fully extinguished within three years
• This insures that, in particular, Social Security and Medicare Trust funds
become whole again and reduce fears that they will “run out” over time due
to budget deficits in the federal budgets
TITLE 6: The Office of Full Employment
• Creation of a new office in the Department of Labor
• Focused on job development for three groups of the unemployed
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Veterans
Homeless
Formerly incarcerated
• Success in these efforts will grow the GDP and therefore not be inflationary
TITLE 7: The Office of Poverty Alleviation
• Created in the Health and Human Resources Department
• Focused on emergency care and efforts to locate and/or provide jobs for
those living in poverty
• When every person who wants a job has a job, poverty will cease to be a
blight on our cities and rural communities
TITLE 8: The Office of Conflict Resolution
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Created in the Justice Department, with a secondary office in the MCCA
Seeks win-win solutions for conflicts that can be obtained with modest amounts of
EPM funding, for example
Flint Michigan water supply, and Keystone XL and Dakota Access Pipeline projects
Chicago (and other big city) gang violence
Homelessness caused by bank evictions alleviated by government assisted
refinance arrangements
TITLE 9:
Periodic Partial Audits of the FED
• Provision for periodic GAO audits of certain key parts of the FED, focusing
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Ownership of the 12 Federal Reserve Banks to identify potential conflicts of interest
Income and Expense and Balance Statements for the Surplus Accounts to identify
potential sources of “hidden” funds
Transfer of Math and Computer Models to the MCCA to facilitate development of new
control theoretical models of the NASA variety
TITLE 10: Monetary History Documentaries
• Fund preparation of three Monetary History documentaries highlighting
successful use of government created money in the past
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Colonial, Revolutionary War, and Civil War periods
Guernsey/Jersey Island in the 1817 – 2017 period
Canada in the 1935 – 1975 period
• Distribute to the voting and ex-officio members of the MCCA and make
available to the public through the US Government Bookstore
NEXT STEPS
• Establish the Monetary Reform Task Force as a formal entity within the
Treasury Department
• Find sponsors and cosponsors for “real” legislation prepared by members of
Congress
• Rally public and Congressional support for the enabling legislation
• Present the bill for signing by the POTUS