Thread On Taxation, Public Charters and the New Paradigm on RWER Blog

Me:  The economic system can remain profit making in nature, in fact keeping it so while making every sane ecological project required for species survival possible by implementing a non-profit publicly administered financial system not only enables such to BE possible, but gets all enterprise but the oil industry on your side. This is the precise hitting of the mark.

KZ:  How do we balance the unrestrained pursuit of profit with the needs of the public good? President Trump said when entering office that he would not stop the pursuit of profit for his businesses just because he is President. If a President, even a sociopathic one can’t give up the pursuit of profit to be President for the entire nation, what chance is there that any CEO will give up profit in favor of the public good. Even if climate change leads to Sapiens’ extinction, profit remains more important.

Me:  You eliminate the most underlying problem, private finance and its paradigm of Debt Only, subsidize every enterprise that signs on to the sanity of ending CO2 emissions and tax the friggin’ hell out of those that don’t, namely petroleum corporations. Let’s get off the dime. Maybe make sand the new diamonds just to compensate the Saudis, Iranians etc. Use our imagination.

KZ:  Craig, if all companies are publicly financed as you suggest that means financing must come from either customers or from tax money. Customers and taxpayers overlap. How would you balance the interests of the two groups in terms of corporate financing? This model was tried during the early days of the USA for companies that served basic or essential public needs (e.g., water, firefighting, sewage, schools, hospitals, etc.). But more than this, corporations of every sort were heavily regulated by state governments. That regulation came in the form of the corporate charter. In exchange for the charter, a corporation was obligated to obey all laws, to serve the common good, and to cause no harm. Early state legislators wrote charter laws and actual charters to limit corporate authority, and to ensure that when a corporation caused harm, they could revoke its charter. Charters also, at times limited the profits corporations could receive and who could serve on the board of directors. This reflected a much different view of corporations than the one in control today. “Neither the claims of ownership nor those of control can stand against the paramount interests of the community. It remains only for the claims of the community to be put forward with clarity and force” (A. A. Berle & Gardner C. Means, The Modern Corporation and Private Property, 1933). The model was eventually destroyed by corporations and business-friendly legislators. In pursuit of greater profits and more political control. How do you suggest we protect it today if we manage to restore it?

Me:  “if all companies are publicly financed as you suggest that means financing must come from either customers or from tax money.”

Not correct. A public national banking/financial system could just create money and loan it out. Likewise, the monetary authority could simply fund itself. Of course you’d need to have hard and fast rules (every decision to loan or fund is based firmly and logically on the benevolent, exceedingly rational, positive, constructive and ethical concept of grace…with no nonsense or flim flam allowed), but coupled with making it a fourth branch of government, protected from inflation by a 50% discount/rebate policy at retail sale and regulatory and tax incentives and disincentives for bad actors….who needs taxation to fund anything except a reasonable and lesser amount than presently in order to establish the unmistakable sovereignty of the government also based upon the concept of grace?

Cynicism, vested power and struggle equally mean nothing when it comes to species survival and paradigm change. Go to the heart of the problem and solve it.

KZ:  Craig, I guess I’m a bit more of a conservative than you. Right now, the Federal Reserve “creates” money and loans it to Federal banks. These in turn loan to commercial banks. I’d prefer credit unions or something similar provide the money for such a plan as you propose. First, credit unions make no profit. Second, they are member owned. Third, credit unions are cooperative financial institutions. Fourth, credit unions pay no federal or state taxes, which makes their lending genuinely community focused. Finally, credit unions are self-regulating. They’re a perfect instrument for getting us focused away from profit and debt for profit. Finally, any plan to deal with “bad” actors via regulation and taxes will be undermined by individuals and companies that pay little tax now but have learned how to become rich through tax incentives. To have any chance of changing this, we’ll need to arrest and jail these “tax haven” vultures.

Me:   Ken, The actual process is commercial banks lend and then look for reserves. The FED, even though they have the charter to create our money (only as debt), is actually the handmaiden of the too big to fail banks.

As for credit unions the new paradigm doesn’t outlaw them or other forms of banking that are allowed to loan only already saved money and profits it just doesn’t allow them to actually create new money. Of course having to make a profit they would have to charge interest and so they would have a very big problem competing with a non-profit national publicly administered AND FUNDED banking and financial system which would NOT need to charge interest and as my book points out could become the new legitimate ending point for the economic process where a second 50% discount/rebate policy was enacted on products that made ecological sense.

Private finance could always fund legitimate and ethically vetted speculative ventures that the national system did not deem were likely to pan out. When we made the change from hunting and gathering we didn’t stop hunting or grabbing an occasional apple from an orchard, it’s just that these actions lost their primacy.

 

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