So here it is. My first practical spirituality article, which tries to translate very abstract esoteric concepts into practical implications and actions.
I invite you to discover my “Spiritual Journey” series if you want a to know about the abstract, theoretical spiritual background these articles rely on. In short, the “main” idea which will be explored in this series is the implication of the “we are all one” idea that you hear, time and again, in esoteric teachings. What if each human is one cell inside the body of a “larger being” or entity? How does that change our way to do politics, economics, science, or just about anything?
Today, we are going to look specifically at the financial system which, in my mind, is the most important element to tackle, and which draws a lot of attention from the spiritual community (just search for “financial reset”). If you buy into the fact that humanity is one global organism, then the financial system is very much like the circulatory/respiratory system. The heart and arteries corresponds to the private banking system, which is in charge of distributing the energy (money) to enable the various parts of the “body” to do certain things: build projects, renovate, launch businesses etc. The respiratory system is more like the central banking system, ensuring that the private banking system receives more or less energy (money) depending on the needs of the body. You can see just how important this is. If your liver stops functioning for a bit, you might live for a couple of hours, the time to get you fixed up, but if your heart stops beating (if money suddenly stops circulating in the economy), you’re dead. The private banking system, in this case, was extremely smart in making sure that the payments system was kept under their control (basically, the money on your bank account), as it is holding it hostage and making sure that States will bail out nearly any and all slip ups for fear of… a heart attack and sudden death.
Arguably, today, it’s all in pretty bad shape. Quantitative Easing can be seen as severe hyperventilation, that is, sending too much energy into the body even though there is no concrete activity that the energy is being used for, which can cause you to pass out. The heart and circulatory system is also pretty broken. The heart has a completely disproportionate size, and consumes much of the available energy to maintain itself, it dispatches energy very inefficiently throughout the body as some parts of “humanity” are completely cut off from any access to money. And finally, it doesn’t mind serving a few parts of the body which have grown dis-proportionally and drain most of the energy of the circulatory system. Basically, the 0,1% ultra rich who bought up most of the economy and enjoy a passive income which sucks up a lot of the available wealth for either consolidating their ownership further, buy up assets like land, consolidate their power by buying up the “independent” media” and influencing politics (lobbies and campaign financing), or just buying luxury items. It’s the same as if your left thigh was 10x it’s size, and was draining energy away from your other organs/body parts.
How should we fix this? In the esoteric “woo woo” community, people talk about the “great financial reset”, where the whole financial system will collapse and will be replaced by something else, which is never really clear and defined. In this narrative, the banking sector is “evil”, the elites, called the “cabal” are “evil”, and the “good” will triumph with something better, whatever that is.
If you followed my Spiritual Journey, you will have realized that this analysis is rooted in duality, good vs. evil, and thus ill suited from the perspective of a point of view where we are all one global organism. Instead of proposing healing, they propose amputation, which is the very last option any sane person would consider. And amputation of your circulatory system means… death… So…
My analysis is different. I see the entire story of humanity the same as you would see a plant growing, from the moment a seed germinates, turns into a sprout, and grows into a full sized plant. There is no moment where it is “good” or “evil”, it’s part of a natural process.
Sometimes, it gets attacked by bugs, other times it suffers from drought, but ultimately, it overcomes those obstacles and grows ever more beautiful.
The passage from the current system to the next is therefore a natural evolutionary process rather than a move from “evil” to “good”. Just like we moved from monarchies to representative democracies, just like we moved from pre-capitalist medieval societies to capitalism, so too, we are about to transition to something else, which is just the next step on an infinitely long evolutionary journey.
So finally, what’s going to happen in my mind?
If you take an interest at what’s happening behind the perfectly neat smoke screen of “jobs, growth, this time it’s different and we’ve solved the problems trust us” acting as a psychological manipulation tool keeping the masses (consumers, entrepreneurs) confident in the solidity of the global financial system, the picture is far from pretty. The jobs created are mostly shit jobs: temporary jobs, part-time jobs, precarious jobs… The reforms in the labour markets are actually acknowledging this fact by introducing “flexibility” in labour laws allowing companies to fire/hire as they please (good luck for those workers getting a long term loan). The labour statistics are manipulated as hell. When measuring the “official” unemployment rate in the US for instance, if the polled people answer they are not looking for a job (aka, they have given up trying to find one and live in precarious conditions), they are not considered as unemployed! The level of non-performing loans is still weighing on banks all over the world, the amount of money injected into the system by central banks has inflated everything (stock market, prices of assets…) and many macro-economists are calling this “new” situation as an everything-bubble (as opposed to the dot-com bubble and the subprime mortgage). Of course, that’s not even mentioning the derivatives market or many other horrible financial instruments that have not been cleaned up since the 2008 crisis. Add on top of that political and geopolitical tensions, and you have the perfect cocktail for a major economic and financial shit storm the likes of which we have not yet seen.
So let’s expect the worse case scenario of all: a total meltdown of the global financial system with a collapse of all or nearly all national currencies, political extremism mounting, martial law in place following riots and pillaging in the streets ushering in a military controlled authoritarian and centralized State, with countries managing more or less well given their ability for autarky or providing for the basic necessities of their citizens and having to “fight off” (probably even kill) migrants from other countries (and not only the poorer ones) who live in States with low food production/supply, water, electricity etc.
Now that I’ve got you running for guns, batteries and food/water supplies to barricade yourself inside your home, let’s calmly try to think of a solution to all of these problems that are simple and realistic. Yes, you read that correctly: simple and realistic. The reason: because of the second law of thermodynamics and entropy, as inescapable rules which apply to all things in the Universe. As time goes by, complexity increases along with chaos, and so does the energy to try to “maintain” it in a functional state. The only way to move beyond that is via a “higher order” inside chaos. Such is the case for life which introduces more “order” out of chemical chaos, which then inevitably turns to chaos again. The current financial system is probably at it’s most chaotic point and about to collapse. Think about it as a “living organism” which has generalized cancer. The “energy” (understand human intervention) to keep it from collapsing is immense and unsustainable. But out of this process of degradation, you have the opportunity to create something seemingly simple but allowing for even more complexity.
First, let’s rule out a “solution from above”. Politicians, economists, bankers, basically the “people in power” cannot think outside of the box they are in. “If you are a hammer, then everything looks like a nail”. They will not be able to envisage solutions which are outside of the realm of tools they have at their disposal: print more money, nationalize the banks, competitive devaluations, protecting borders, trying to centralize and maintain control, martial law, make demonstrations illegal (both are already being smoothly ushered in via law, following the “fight against terrorism” and the ban of certain protests for “security” reasons as in France for instance), take control of the economy, distribute “vouchers”, send the military in the streets to protect major stores (the big corporate giants, Carrefour, Walmart, Amazon… of course, not your local small entrepreneur) which will only exacerbate the centralization of power, and before you know it, we are effectively in a form of “semi communist-monopoly capitalist” Dictatorship where the State in alliance with a select few economic elites decide everything (central planning): who gets what, and who should work where. Maybe we’ll even see the resurgence of work camps (aka Gulags), who knows… “Desperate times call for desperate measures” as the saying goes… If you want a glimpse of what might await us, look no farther then Venezuela.
And of course, the “flavour” and shape of this trend will vary according to the country. Countries like China are nearly already there so for them, not much will change, except perhaps an even stronger State control over the country. In the US, it will probably be pretty messy. In Europe, if the European Union falls apart, it will be even more chaotic.
That being said, I don’t mean that politicians and public authorities in general have no role to play in the solution I envisage. On the contrary. I foresee a key role for the politicians that really do work for the general interest and not serve their own personal hunger for power or money. What role would they have? The role to encourage people to take up this solution by themselves! Giving the “power” back to the people.
Now to the solution. Drum roll…
And the winner is: a Universal Basic Income in the form of a crypto-currency implemented via a decentralized, permissionless blockchain, applying the principle of the Relative Theory of Money.
Say what? Bear with me.
Let’s start with examining the Relative Theory of Money. This is the only monetary system/theory that can rekindle a loss of trust following a major global financial meltdown. Keep in mind that in the event of hyperinflation the likes of which Venezuela has seen, then no matter how much money you print, it’s useless. Once people lost trust in the “store of value” component of a currency, it’s game over. The Relative Theory of Money is a monetary system which could be described, in simple terms as a mathematically adjusted “quantitative easing for the people” in the form of a permanent “Universal Dividend” being paid out to each and every individual. So it’s a form of Universal Basic Income that each and every person receives unconditionally.
But there is a “twist”. It is the term “relative”. Instead of displaying prices and “counting” in individual units of money (for instance, 300€), you count in terms of units of Universal Dividend (UD). What does this mean? That you decide, by convention, that a month’s worth of Universal Dividend (UD), regardless of the amount, is equivalent to 1. It’s like counting in “salaries”. If everyone has the same salary, then you can display the prices and evaluate the costs of goods and services in “units of salary”. For instance, a car would cost 12,3 UD. A bread would cost 0,05 UD.
“What’s the point” might you ask? It has to do with the way the Relative Theory of Money envisages monetary creation. Periodically, the amount of individual units of money is increased. And so after say 2 years, you would receive 400 units instead of 300 units. So in individual units of money the prices have gone up, but in Universal Dividend the prices have remained the same. So basically, it’s “baked in inflation”, or negative taxation, or a form of natural, mathematically planned, redistribution of wealth. There are many ways to see this.
Why would this be a good system? Because it is a system where no one can get stay extremely rich forever or extremely poor. It is the perfect social security net which redistributes wealth without the need for taxation. As time goes by, if someone managed to monopolize all the money, his “share” will shrink in proportion to the share of what others have. As an example, imagine that 10 people receive each 10 units on day 1 and one of those people is a very famous pop singer and organizes a concert which he charges 9 units for. At the end of the day, that one person has 91 units and the rest have 1. He has nearly 100 times more money then they do. But on day 2, since each person again, receives 10 units, now the famous pop singer has 101 and all the rest have 11, which is only a ration of about 1 to 10.
Let’s move on to the “crypto-currency” part of the equation. The reason is simple: to break out from the centralized control over money and money supply that brought us here. First, let me reassure you: this is not an anarchic project that seeks to overthrow governments and do away with centralized authority. It is merely a logical next step of separation of powers which took us from dictatorial, authoritarian states to democracy. In order to avoid concentration of power and arbitrary use of force, political thinkers such as Montesquieu came up with the principle of the separation of powers or the “checks and balances” in the US: breaking up governments in the executive, legislative and judiciary branch. This arrangement is currently experiencing severe strain. In the US, the Republicans and Trump are clearly attacking the system by trying to appoint politically skewed judges and obstructing justice in a variety of ways. In Europe, several governments have “amended” their Constitutions to give disproportionate powers to the executive branch. Even the electoral process, with the help of mass media, has skewed the voting process so important for democracy by scare tactics, discrediting certain political candidates with political ideas (mostly left wing) which were not in line with “the establishment” (among which the rich billionaires owning the mass media).
And so we have a choice: a “recentralization” of political/economic power where most of us will become mere work slaves, or a new “decentralization” of political/economic power which will reinvigorate democracy and usher in a new era adding monetary policy to the list of separation of powers.
And this is precisely the reason why the Relative Theory of Money cannot be implemented by governments but has to take the form of a permissionless decentralized blockchain/crypto-currency controlled by the people directly (direct democracy). This is also extremely important to break from the “monopoly” and “unique legal tender” system that we currently know, which basically means: “if shit hits the fan, you’re going down with the ship”. For all those that my arguments do not convince, and believe that such a Universal Basic Income system will not work, they are free to chose any other system they like, be it Bitcoin, a resurrected Euro from the dead, Gold, a sock, their watch, their kidney… I (and society at large) could care less. The whole point and advantage of crypto-currencies is that since they operate directly via the Internet without any intermediary, decentralized exchanges can instantly convert one crypto-currency into any other for nearly no cost. So people will remain free to chose the crypto-currency or legal tender of their preferred choice. If they are greedy and arrogant (the people that thought of buying Bitcoin when it was at 0,01 cents and are now billionaires) then they will “push” others to adopt Bitcoin so they can become their Overlords, the “new rich” with their “serfs” at their service (the ones adopting Bitcoin last). If they are sensible and believe in a society where there should be a bare minimum for all and yet a way to get rich (but not too rich) for the talented and dedicated, then they will adopt a crypto-currency derived from the Relative Theory of Money. And the “cherry on the cake” is that these systems are not mutually exclusive. You can have a “mix” of both. A Universal Basic Income crypto-currency should basically be like a foundation or solid safety net which allows for experimentation and innovation without “breaking” the system, without a brutal interruption of all economic transactions and the freeze of the entire financial system (as would/will be the case if the current monetary system collapses).
Such a cryptocurrency already exists. It is called G1 (pronounced “June”) and can be downloaded/explored further here: www.duniter.org
In order to “create” or open an account which is entitled to receive a daily UD, the person needs to be “certified” as being a “real” person by at least 5 existing members, via a physical “in person” meeting (the technology relies on the open source “web of trust” system). This certificate needs to be renewed every 2 years so if that person cheats and opens several accounts in order to get more UD, there is always a risk that his accounts will not be renewed if he/she cheats and is discovered.
The code is open source and other G1 currencies are encouraged to be developed in various parts of the world, in order to avoid a monopoly setting in again, and also in order to adapt to “local” conditions, productivity, prices, demographics etc.
Finally, I would like to offer my ideal scenario for a smooth transition from this system to the next.
Above, I have argued that this system should take the form of a decentralized voluntarily adopted crypto-currency. However, that is the ideal scenario and what the process will ultimately lead to. But in practice, there are many options ahead. The most likely, in my mind, is a gradual transition from one system to the other. Given the fact that our entire civilization depends on the stability of the financial system, it is unlikely that a decentralized crypto-currency solution from the ground up among a global financial meltdown will see the light of day. First and foremost because the production of energy and maintenance of Internet access relies on companies which themselves rely on the financial system. So good luck setting up a public blockchain when the electricity and Internet shuts down.
Here is my scenario. As the financial system freezes due to some severe shock and elites panic for failing to know what to do, the information of the Relative Theory of Money will reach their ears and they will execute the following plan to save their own asses from a Mad Max situation:
- In order to preserve the legality of the transition, all current account balances up to 100.000€ or the equivalent sum of money (deposit guarantee scheme) in other areas of the world will be guaranteed and converted into the “new” currency which will underpin the Relative Theory of Money (which can still be called “euro”, it doesn’t matter).
- An exceptional 10.000€ “citizens’ dividend” will be granted to each citizen’s account in order to make sure that each person has a certain financial safety cushion to avoid social unrest due to the mass inequality and poverty.
- All banks will convert one account of their client to become the account which will be generating the Universal Dividend each day. That account will be whichever account citizens have listed as their main account on their tax return.
- Each child will also receive such an account, starting from 0€. Citizens will be able to create such an account via public authorities’ online portals by registering a new account created in a bank to their child’s name. In case a child in the public authorities’ database has no registered account, an account will be created for them in the national central bank.
- From that moment onward, the power of monetary creation of private banks will be suspended. Only citizens will be able to create money.
- All outstanding private debts will be reduced by a certain percentage to allow the economy to breathe. All outstanding debts from companies and States will be honored in full.
- However, new loans issued to repay older debt will solely take the form of bonds. That is, banks will have to sell citizens corporate or public bonds in order to issue any type of loan. This includes any form of credit: consumer credit, mortgages… Any and all loans will be funded via bonds. This means that instead of putting their money on a savings account, citizens will directly fund the economy by buying various bonds depending on their preferences. If they need to get that money back, they will have to sell the bond on the financial markets.
- The second option is for publicly traded companies to issue new shares (which I would greatly support) in order to dilute the ownership of a handful of ultra rich. This would effectively be the same as a nationalization by the people of the stock market.
- States will be able to raise taxes via two main mechanisms: taxing the UD upon creation, and VAT (value added tax). Since each person receives the same UD, taxation would be fair, and using VAT would no longer be a tax which disproportionately hits the poor given the effect that the Relative Theory of Money has on equalizing money distribution. Taxation could thus be simplified to the extreme, and government budgets could be much more predictable (taxing the UD a fixed percentage upon it’s creation means that if you know the total population of your country, you know exactly how much tax you’re going to collect each day).
- Social safety nets and all other transfer benefits can be maintained, but they would be converted to an insurance instead of a benefit, protecting citizens against the risk of unemployment or the risk of being disabled.
- As time progresses and the economy and financial system stabilizes, citizens will gradually become educated about how this theory works in practice, and a reform to gradually allow for taking ownership over the account which generates the UD will be introduced.
- First, a right to “switch” your account between banks to introduce competition.
- Second, a right to “port” your account to new banking providers (like cooperative banks or even the central bank).
- Third, these accounts will be converted to a decentralized public blockchain maintained by people themselves, in cooperation with public institutions, and citizens will have a choice to either manage their account directly (they will be given all the necessary keys/passwords to have full ownership and control) or allow a third party (like a bank) to manage it for them.Also, as time goes by, old debts are repaid and the new ones no longer go into the pockets of banks or a few elites, but in the hands of citizens since they are the only ones that can create the money supply, and therefore, the only ones that can buy the bonds that banks will have to issue when they create a loan. Banks will therefore only become intermediaries between investors (citizens that want to buy a bond) and borrowers (States, companies, individuals) who will get the money from the bond. If you want to get an idea of how this works in practice, check out the Danish Mortgage Model which already operates using this system.
A few questions that you may want clarified:
Could prices vary?
Yes, as a function of supply and demand (if for instance there is a shortage of cars, bread…) but not as a function of the supply of money (inflation) since a price displayed in UD has the cost of inflation baked in.
Why would anyone in their right mind opt for such a system?
Well, let’s go back to the idea that “we are all part of one global organism”. How does your circulatory system distribute energy (oxygen/money)? Depending on the need. But who gets to decide what’s the need? And this is where it gets interesting. Each and every of your red blood cells gets the same initial amount of oxygen to start with, and then, as it circulates through the body, that oxygen is dispatched as a function of what you are doing. If you’re running, the energy flows to your legs. Once you settle down and start taking your test, it flows to your brain. Not immediately though. The energy peaks, and then slowly decreases, even maintaining a certain level of energy to repair damaged cells, and build up muscular tissue in prevision for the next time you run.
Examine closely the way the system that I have described to you functions. Each person gets an initial amount of money each day via monetary creation, then they spend it based on their needs and what they believe is needed generally. Whenever you spend your money, in the end, it is like if you were voting on what should get produced (called a “market signal”). Every time you buy something, it is as if you said “please make more of this”. In essence, it’s exactly as if each person was one red blood cell, and was deciding on an individual basis, where that money/energy should go. And the sum total of each individual decision amounts to a form of global coherence, a form of “wisdom of the crowd” effect. There is no central planning organization, no Dictator, just a form of collective decentralized decision making which somehow forms something coherent when taken from a broader perspective. This is the exact description of how your body works. From the inside, if you are into micro biology, looking at individual cells would have you believe that it’s a bloody mess (pun intended). But if you just zoom out, there you are, sitting chill in your couch, while inside you, there is a whole Universe buzzing and zooming all over the place.
What about the problem of laziness? Won’t people stop working?
There are two responses to this problem.
First, one must stop to assume that everyone works only for money. If you look at both children and retired people, they work to quench their thirst to learn (in the case of children) and to keep them busy (in case of retired people). As for adults, think about it. If you were given the exact same amount of money that you had: if you hated your job, you would probably quit. But would you sit in a couch doing “nothing”? Perhaps… If the current “values” of our spoiled materialist capitalist system has rotten your values to the core and you “buy in” to the “ultimate” dream: winning the lottery and drinking cocktails on a sublime beach front. But for many adults, especially those that like what they do, they would continue doing it regardless.
Second, don’t forget that this UBI system is only meant as a minimum stabilizer. On top of that, I would imagine a system where the labour market would finally function as it is supposed to. People would get paid as a function of supply/demand in another legal tender that would sit on top of the UBI. What does that translate to? The jobs no one wants to do will be paid most and the jobs everyone wants to do will be paid least. So being a garbage collector will be paid a lot, since I doubt it’s anyone’s dream job. And if you want to do your dream job and many other people want to do the same, then you’ll be paid very little money. But what do you care? You’re “doing what you like”! For those that want “money” instead of doing what they like, then they will always be free to look at the jobs that no one wants to do or no one can do. The “elasticity” or speed at which salaries adapt to ensure that we have the right “balance” in the labour market still needs to be figured out (for instance, how quickly should salaries rise if there is a shortage of doctors, or fall if there is an “over supply” of doctors). In the end, I think people will become pluri-disciplinary breaking the “specialization” at all costs trend, picking up garbage one or two days a month to rake in cash and doing something else the rest of the time.
A nice “side effect” of such a system is that Artificial Intelligence and Automation will be focused on the jobs humans hate or don’t want to do.
Is this Communism?
In the way it was applied, absolutely not. In the way Marx foresaw it, probably, yes. Keep in mind that in this system there is no end of private property. It is just that each person is entitled to the same “share” of monetary creation. So you may say: “hey, but that’s even worse than communism, everyone has the same salary!” Careful now. The Universal Dividend is not a salary. It is a share of the total money supply created daily. After you receive your UD, economic exchanges happen, and at the end of the month, some people have accumulated a lot of UD (those who worked hard and provided something meaningful to society), some people will have less of it. So in this system, you can become very rich. There is no real limit as to how rich you can become. It’s just that the moment you stop working, the gradual incremental creation of new money will dilute your level of wealth compared to others. Just like when you stop running and energy is gradually refocused elsewhere in your body.
The reason it’s more like what Marx had intended, is that it fits quite well Marx’s famous quote: “From each according to his ability, to each according to his needs.” It was a mystery regarding how you should apply this in practice… until now.
What will this change?
This will convert the entire economic and financial system into a direct democracy. Until now, private banks and the ultra rich had a disproportionate amount of power in deciding what the overall economy and availability of goods and services would look like depending on whom they granted a loan to (banks), and where they would invest their money (ultra rich). By putting monetary creation in the hands of people themselves, each day, their individual purchases and decisions will contribute to shaping the economy to reflect what the people value. If they value sustainable goods/services which pay decent wages and operate in ethical settings, they will have the purchasing power necessary to encourage those types of goods/services to take over the economy. It is a way to break the circle of powerlessness where we elect politicians just to be able to have someone to blame when things don’t go the way we want and claim our status as powerless victims giving us the right to complain and do nothing.
How is this system any different than any other proposal?
For many reasons. First, you must understand that any alternative to the current debt based model for monetary creation has to solve the difficult problem of price stability. The Relative Theory of Money is the only theory which, to my knowledge, deals with this problem. If the monetary mass doesn’t fluctuate in sync with the total availability of goods and services, then you get either inflation or deflation, both of which are detrimental to economic stability.
Now, why not just stick to the current system and implement a form of Universal Basic Income? Because a UBI financed by taxation will face major resistances and likely never be implemented. It’s also perceived as an “injustice” where you take from some to give to others, whereas the system I have described above doesn’t take anything from anyone. A UBI financed by monetary policy (basically, central banks printing the money) is similar to the system I described above, however, since it operates alongside a debt based money system where money is constantly created and destroyed, if the freshly printed money doesn’t “exit” the economy and keeps turning in the economy, it can create inflation. Also, on a more fundamental level, it doesn’t question the disproportionate influence that private banks and the ultra rich have on the financial system and the economy.
Finally, the reason my solution is better, is because it is not one which pins blame, requires a revolution, to cut heads, to destroy the evil banks or fight the evil ultra rich, it is one where you simply move on to something else, you switch systems altogether, and leave the old one because it no longer suits you without having to first burn buildings and topple cars. It’s the same as growing out of your old shoes. You just leave them behind and get new ones.
How do you know this is what will happen? How do you know this system will make it and not another?
Because the reasons for this system to be the replacement of the old is transcendental. It goes beyond any dual logic of “good” vs. “evil”, or polarities. It is the same reason why your circulatory system functions the way it does: because otherwise you’d be dead. There is no better reason. It’s a purely evolutionary reason having to do with survival, the preservation of life, which has validity beyond any type of argumentation or reason. Life doesn’t need a reason to thrive. It just does. The system I have presented above carries that sort of power, that sort of legitimacy. While I defended it using logic, in the end, it will be the future because otherwise we’ll be dead. It’s as simple as that.
I hope you found this article interesting. If you have questions, happy to answer them and amend this article accordingly. See you in the next edition where we will be talking about reforming the political system.
The Universe cannot be anything less than what it already is.
Marma