This is the best attempt I’ve seen at building a sustainable, democratic, (and inevitably moneyless) economy. It’s worth understanding what they’re saying

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Posted May 11 2017 by Dave Darby of Lowimpact.org

If you’ve got a sneaking suspicion that whatever we do, we’re not going to transition to a sustainable, democratic future with the current money and banking system, then I agree with you.


First, after initial feedback, let me explain something. I’m not suggesting that you take the course. You’d be welcome too, but I know you’re all busy. I’m going to be taking the course, and I’ll summarise outcomes here on this blog. If you have any feedback or questions for the course tutors (see below), let me know. I want to know if you think they’re on to something. I really think they might be.

Summary: they’ve worked out an implementable way to transition to a moneyless economy. Global account – everyone works for credit, purchases with debit. No rich or poor, no interest, no economic migration, stable economy is possible. Invented in 1836. Implementable now in the age of the internet with blockchain technology. Would make the entire banking industry redundant.


Would you like to come on a journey with me to learn more about how this money system evolved and how to replace it with something better?

I’m going to be doing a free (as in gratis) online course, provided by the Institute for Leadership and Sustainability. Starting in August, the course is about the evolution of the money and banking system, the problems it causes and alternatives that could replace it. Actually, it’s a MOOC – see this video:

The course itself is free, but there’s a fee for a certificate if you pass (which I personally don’t need). As the Wikipedia entry states, there’s unlimited participation on a MOOC, so you’re very welcome to join me, but if you don’t have the time or the inclination, I’ll be summarising here, and you can comment or ask questions.

Here’s the course, and here’s a video with more info:

Two of the tutors involved in the course are Matthew Slater and Jem Bendell. The MOOC itself is just educational, and doesn’t propose one solution. However, I’ve come across their writing before, and I their position is that the banking system is unreformably flawed, for reasons I tried to summarise in a recent Facebook post:

I work for an environmental organisation, but I’m often disappointed with the position of environmentalists who think we can achieve a sustainable world whilst retaining the current banking system. We have to get rid of the corrupt banking cartel – the most powerful cartel the world has ever known. They:

  • have government-mandated monopolies on the issue of currency, via loans of money they don’t have, with compound interest attached, with security provided by the borrower. It’s a giant scam. Fractional reserve banking is ancient history.

  • charge so much interest (on loans of money they never had) that there isn’t enough money in the world to pay it all back. The economy has to constantly grow for the interest to be payable. This is the root of the ecological damage that puts human survival at risk – just for bankers’ profits.

  • make inequality worse. Although individuals can escape debt to banks, collectively, the world can’t (because there isn’t enough money to do so) – 2% of the world owns 50% of global wealth, and it is becoming more concentrated because of debt.

  • debase the currency by backing government deficit spending with their make-believe money, creating inflation which increases prices for ordinary people, increasing inequality even further.

  • choose who they give loans to – and it’s not to people who have useful ideas, if they’re not going to result in large profits for banks. So property speculation rather than socially-useful projects.

  • don’t just influence government – they are government. Trump has filled his cabinet with Goldman Sachs people. If you research the numbers of just Goldman Sachs people, let alone other banks, who sit in governments and in global financial institutions, it would take all day. Plus they give jobs to politicians when they leave office.

  • pay themselves huge salaries and bonuses

  • get bailed out with taxpayers money when they fail because they were just that bit too greedy.

Their solution is a moneyless, international, mutual credit system. Here’s a summary:

If the idea were to be implemented globally, there would be a free market – do what you like – there’s no state, tax, or planning. Nothing to scare off the right there (and if you scare the right, you set half the world against you from the off) – but there’s no money either. Everyone gets an account, set at zero. If you do useful work – either yourself or as part of a group, you get credit. When you purchase products or services, you get debit, and the person or group you purchase from gets credit. Every transaction carries a tiny insurance premium for when people can’t work. It’s like social security but it’s handled by a co-operative insurance company rather than a state. There’s a limit on how far you can go into credit or debit, so everyone’s account hovers around zero, and the sum total of all accounts is zero. It doesn’t matter where you are in the world – it works.

After a lifetime of reading political philosophy, this is the first idea that is, in my opinion, genuinely implementable. I can see it happening if enough people can be persuaded to get behind it. So far, Slater and Bendell have started to co-ordinate mutual credit schemes around the world (for example, time banks and LETS schemes) so that they can trade with each other. Slater is co-founder of Community Forge and they’ve started to build a partnership with an older organisation, the Community Exchange Systems Network. They are proposing a commons software architecture for a non-money system, and we are looking for ways and partners to get it built.

Imagine if co-operative institutions can be co-ordinated to switch to this idea, purchasing things via debit and paying wages via credit in a global mutual exchange system, it could really start to change things. Imagine getting your wages in credit, and then using that credit to get your food from community-supported agriculture, wholefood co-ops etc, your energy from community energy schemes, your telephony from the Phone Co-op and even your housing via a housing co-op. You can envisage a path to its implementation – something that’s lacking from most political ideas.

So I suppose I’m trying to persuade you to at least give it a look.

I think they’re right, and the more you think about it, the more problems it solves.

  • Not left or right – it’s a free market, so it doesn’t have the bureaucracy of socialism, but it doesn’t have the exploitation of capitalism either.
  • No money means no poor or rich people. You can’t accumulate money and it can’t be scarce because there isn’t any – just people doing useful things for each other for credit.
  • No money means no interest, so the economy doesn’t have to perpetually grow to pay it back – which means that we can live in harmony with nature, which is impossible under capitalism.
  • The fact that it works everywhere means no economic migration. You don’t have to move anywhere to get work – just work wherever you are. Families don’t have to be broken up for money.
  • With no state, no tax system, no economic migration, there wouldn’t have to be nations, borders or armies – so a chance for peace.
  • It’s a free market, but relations between people have to be free as well. There’s no making money from anyone else’s work – only your own. There’s no private employment – no ‘bosses’, and no landlords. You can own your own home or land (that you work) but no-one else’s. No shareholders, no return on investments, only work. The market is free for you to do whatever you like and see if people will pay for it – as a sole trader, or you can get together with other people in co-operative, democratic institutions.
  • Credit can be allocated for work that is wanted – by individuals, co-ops or communities. Who gets credit is not decided by banks and it carries no interest.

Let me know (below) your initial response, and ask questions. We can put those questions to them and generate ideas to make implementation more feasible. Let’s think of what’s wrong with this idea, and what questions we need answered. It doesn’t mean that we have to abandon what we’re doing – let’s carry on, but keep an eye on this as well. Otherwise all our work will remain marginal.

Positive Money explain the money system well:

But their solution is a state solution. I’m not convinced going the state way is the best way to to. I’d prefer to go in the opposite direction, in fact – get the economy into the hands of ordinary people, without being controlled by the state or the corporate sector. I might be wrong about this, but I don’t think that PM are challenging the (absurd and impossible) concept of perpetual economic growth, either. As long as there is money, it will concentrate, and there will be interest, rendering the economy undemocratic and unsustainable.

I think that Bendell and Slater’s idea is a winner, but I have some questions for them (and more reading to do in the mean time).

I’d like to ask them whether they can envisage existing non-corporate institutions switching to their scheme – even if partially at first. Countries of the ‘South’ have nothing to lose. Why wouldn’t their people do it, rather than work in corporate sweatshops or plantations? And there are plenty in the ‘North’ who would have a go with a system that might remove the power of money.

Here’s a paper by Matthew Slater and Tim Jenkin on a mutual credit economy. They call it the ‘Credit Commons’.

Here’s a chapter of a book by Jem Bendell, critiquing the current money system. Plus one more video (and if you only watch one of these vids, watch this one) – here he is nailing it:

And here’s a blog article by me, failing to disguise my excitement at having discovered what they’re up to.

Do you want to join me on this learning curve? The amount of time you spend on it is up to you. I’ll be blogging about what I learn. You could just drop in from time to time to see if there’s been any progress, or you could join the course. What do you say? Could you also please let people in your (electronic or face-to-face) social networks know about this. Thanks.