Re: Brave New Creditary World

["William B.Ryan" <william_b_ryan@xxxxxxx>]

Mr. Armstrong,

Thanks for the copy of the correspondence with Mr. Meakin.  For
referencing, I've archived Meakin's post of March 29 at
http://www.geocities.com/w_b_ryan/meakin-3-29-00.html and your reply
at http://www.geocities.com/w_b_ryan/armstrong-3-29-00.html

I am in substantial agreement with the following qualification:
Fractional reserve bank credit is merely the generalization of trade
credit.  It is a natural monopoly that is essential to modern
commercial civilization.  The monopoly should be controlled through
legislation and regulation, and supplemental fiat money issued as an
accounting adjustment and instrument of social justice.

In the US we already a national credit authority--the Federal
Reserve--with every power needed to do the job.  The problem is that
its philosophy and underlying economic theory upon which it operates
is flawed.

The Fed could in principle credit the government's account at the
Treasury periodically certain economically justifiable amounts
debt-free.  Government spending beyond these amounts would be covered
by taxation or borrowing as at present.  The scope of government
should be limited to what government does best.  What private
enterprise does best should be left to private enterprise.

Producer subsidies are useful not only as an off-set to inflation but
to sustain certain industries deemed essential to national security.

Infrastructure should be a priority.  Existing infrastructure is
crumbling and worthwhile new projects are not undertaken because "we
don't have the money."  The last major project in the US was the
interstate highway system, completed many years ago.  Infrastructure
should be defined very broadly to include social infrastructure, or
"ultrastructure" such as education.

The dividend should be introduced gradually--in very modest amounts
initially but increasing over time--distributed universally as a right
of citizenship.  It should be unrelated to taxation or other benefits,
including the existing earned-income credit and welfare and Social
Security.  It should be funded entirely from debt-free Treasury
credit.

All reforms should be introduced systematically so unforeseen
consequences--and there most certainly will be many--may be
accommodated.

Bill Ryan
william_b_ryan@xxxxxxx
http://www.geocities.com/w_b_ryan



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