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The Money We Deserve

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Abstract

This collection of essays has aimed to open up the debate about a subject matter that is a vital ingredient in all our lives, in our society and in the world. Money is our product; it reflects our values; at the same time, it influences our ways of relating to one another. As a pervasive presence, money can and should be a part of our efforts to improve the human condition. Money is backed by values and beliefs. As these change, new arrangements are needed.

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Notes

  1. 1.

    Tooze (2019).

  2. 2.

    ‘O happy living things! No tongue

    Their beauty might declare:

    A spring of love gushed from my heat,

    And I blessed them unaware’ (Coleridge 1960/1798)

  3. 3.

    To cite one sign of this, see an ‘open letter on climate-related financial risks’ of April 17, 2019 which stated that ‘as financial policymakers and prudential supervisors, we cannot ignore the obvious risks before our eyes’ of the catastrophic effects of climate change:

    That is why 34 central banks and supervisors—representing five continents, half of global greenhouse gas emissions and the supervision of two-thirds of the global systemically important banks and insurers—joined forces in 2017 to create a coalition of the willing: the Network for Greening the Financial System (NGFS) (see Carney et al. 2019).

  4. 4.

    For further reading on this topic, Nigel Dodd provides an overview in Chap. 8 of The Social Life of Money (Dodd 2014). See especially his account of the approach of the late Richard Douthwaite, which he finds ‘intuitively appealing’, notably Douthwaite’s insistence that different monetary forms meet different social needs. Douthwaite uses a chosen scarce resource—energy, as opposed to labour or time, for example—to underpin the value of money. His work and that of others in this field is being carried forward by feasta—the Foundation for the Economics of Sustainability (www.feasta.org). Warren Coats proposes to anchor the value of the SDR to a basket of commodities (Coats 2011, 2019; (https://works.bepress.com/warren_coats/25/). Leanne Ussher has suggested reforms updating classic proposals for a commodity reserve currency. This remains, in Ussher’s view, a realistic if also futuristic goal for reform rather than a leftover from an outdated era (Ussher 2009). An original approach is pioneered by Joseph Potvin in his proposal for an Earth Reserve Assurance (ERA). This is a framework for valuing assets, including currencies, in a multi-currency system with no central reference unit of account. ERA does not itself create a currency unit. It is a new type of primary commodity reserve system. The method of valuation is designed to mirror the long-term capacity of a currency region to produce primary commodities. It uses practical and measurable factors such as topsoil volume, fertility and distribution, fresh water availability, quality and regularity, various ores for metal and minerals, species populations, genomic diversity and integrity, the extent and condition of local, regional and global habitats, essential biogeochemical cycles, and other indicators of sustainable productive capacity. Assurance of this capacity in the form of Earth Reserve deposit receipts—audited by independent certified authorities, and issued by banks—would serve as collateral for a market in these receipts. Each currency obtains its own Earth Reserve Index. As the index accorded to each currency changes, a participating currency becomes more expensive or cheaper depending on whether ecosystem integrity and resource availability are worsening or improving within each currency zone. A currency becomes more expensive as the Earth Reserve is undermined in the areas where it is used. A currency becomes more affordable as ecosystem integrity and resource availability are enhanced in areas where it is used. Potvin argues that this would create a dynamic force in global trade that is the opposite to what occurs presently. Income and jobs will generally migrate towards regions that enhance the Earth Reserve (Potvin 2019). For easy-to-read summaries and background on proposals for international monetary reform, see Larry White’s blog at lonestarwhitehouse.com https://lonestarwhitehouse.blogspot.com/

  5. 5.

    I owe this formulation to Warren Coats (private correspondence, 2019).

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Pringle, R. (2019). The Money We Deserve. In: The Power of Money. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-25894-8_23

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  • DOI: https://doi.org/10.1007/978-3-030-25894-8_23

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  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-030-25893-1

  • Online ISBN: 978-3-030-25894-8

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