Of Men and Money: 16.06.2050
Page 135 has been scanned for readers of the Thomas Attwood website.
Getting Over the Hangover
Unfortunately, the fallout after the 2008 economic crash lasted a lot longer than anyone had predicted in the 2010s. The 40 year binge leading up to the crash wasn’t paid for out of income, but on credit. The scale of the accumulated debt (personal, corporate and national) was almost beyond comprehension.
But here’s the extraordinary thing: this definitive and very painful turning point undoubtedly changed things for the better. For so many people of my parents’ generation, living beyond their means was not just acceptable but respectable. A preoccupation with competitive consumption was the norm, along with instant retail gratification. And governments were on the same binge too: In 2015, total public debt in the USA amounted to $58,000 per US citizen – imagine trying to get all that back onto an even keel!
Every one of the big banks that dominated the financial scene at that time has disappeared since then, transformed into very different entities: mutuals, cooperatives, credit unions and wealthcare managers, operating at either the local or regional level. All of these are doing what was once described as ‘boring banking’ – savings, deposits, loans, mortgages, current accounts, payment systems, financial advice and so on.
Something else has changed too. People simply didn’t understand how credit worked at that time. Instead of governments themselves (through their national banks) providing credit at zero interest, they allowed banks to create almost all of the money supply by making interest-bearing loans.
For the banks, that interest was pure profit – as the rest of us got deeper and deeper into debt. There was no law that said the money supply of a country had to be managed in such a way that the rich benefitted at the expense of the poor. But it wasn’t until 2026 that we finally got a law ensuring that the public money supply would from then on be created by national banks (like the Bank of England or the Fed in the US) or local banks serving the common interest.
The truth of it is that politicians of that era largely handed over the stewardship of the capitalist system to an army of greedy profit-maximizers. They had no real interest in investing in proper wealth creation and were perversely incentivized to make money out of speculation, currency exchange and market manipulation.
Read summarised points here and for more information go to http://www.forumforthefuture.org/forum-network/events/world-we-made-alex-mckays-story-2050-jonathon-porritt