Can we take smaller steps?

Can we take action short of changing to a new money system? Yes. But none of these backward or sideways steps, bandages, or bridges solve the core problems of our unsustainable current system, nor do they provide enough funding to solve our problems without causing inflation:

Core problems of the existing system

Exponential growth

Our current system demands exponential growth to pay interest on debt-created money. This growth imperative leads to exponential increases in population, resource extraction, and land and water usage. It is mathematically and economically unsustainable and will eventually and always result in a financial crash, and ultimately the crash of civilization. It’s happened in the past and it can happen again.

Continuous growth is like a cancer on the planet and it is doing existential harm. Existential harm means most humans may die if we don’t make some changes. Mass extinctions have happened before, and most scientists say, the 6th great extinction has already been triggered by human activity. Let’s change our behavior now to favor life over extinction – while we can!

Special privilege

Our current money system gives a few citizens and businesses privileges and profits that no one else has, giving them power over the rest of us. This makes long-term planning and good decision-making very difficult. Bandages or bridges can help short-term. But, we need to be at our best to face the future, and allowing the bankers to continue to create money and exercise undue influence stands in the way.


Some want us to deregulate banking further; they want fewer banking laws and a return to the free banking era of the 19th century when banks failed routinely, creating havoc in a marketplace that shifted wealth from the many to the few. This would be a disastrous choice.

Some people would like us to return to a gold or silver commodity money for all uses, or a money backed by gold or silver. Commodity money systems, whether 100% commodity, or commodity backed, have always served a rich elite, who can influence and even control the value of the money. Commodity money systems also tend to restrict the total amount of money needed for a healthy economy and can cause severe deflationary downturns. This, too would be a mistake.


Some people would like us to pretend that government is creating money when it borrows. Government borrowing of existing money is simply not money creation. They would like us to let government rack up as much debt as need be to invest in a better and healthier society – while allowing the private banks to continue to create the bulk of our money supply. Some even say that if some of government debt is interest-free, this is creating new money. It’s not; it’s still debt-money in a debt-money system. And, private bankers are still creating the bulk of the supply, so the core problems of exponential growth and inequality are not addressed – and that would be another disastrous choice.


Increase taxes

We can increase taxes. We can make the tax rates and regulations more progressive. We can add a financial transaction tax, which the Congressional Budget Office estimates would bring in an additional $78 billion each year from 2019 to 2028 – at the rate of 1/10th of one percent.14 This would also reduce the currently excessive dominance of speculation in our markets.

We can set a minimum corporate rate so that huge corporations aren’t avoiding taxes altogether and taking advantage of our infrastructure for free. In 2018, under the new tax law, 60 of the Fortune 500 companies paid no federal taxes at all!15

We can significantly increase taxes on the rich back to 70 to 90 percent – the marginal tax rates (on the highest income earners) that prevailed from the 1940s to the 1970s. The very rich use more of our shared resources in their business interests. And they have unfair advantages in the marketplace. In the process of making and using their great wealth, they put more wear and tear on our national infrastructure than the average person. They make greater use of our roads to transport their business goods and services; they use the air safety infrastructure to fly themselves and their employees safely; they count on our educational system to prepare good employees; they rely on public safety to make doing business safe; they rely on government watchdogs to keep the marketplace stable and safe. Higher taxes help to level their advantages a bit and require that they pay their fair share for the use of our infrastructure. And in our current system increasing taxes helps control excess inflation and helps reduce inequality.

More laws

We could pass more stringent banking regulations to reduce some of the privileges that go with the bankers’ power to create our money supply. But, stricter laws only work when we invest additional funds in oversight and holding banks accountable. Effectively monitored additional laws might delay the eventual crashes and maybe make them a little less severe at times. But, the system is unsustainable and it will continue to crash periodically!

We could tax the banks to compensate the nation for their privilege and extraction of wealth. We could adjust the Fed system to reduce or eliminate dividends on their capital stock and interest on their reserves. We could decide not to pay interest on government debt anymore. Zero-interest government bonds would be a safe investment through the next economy-wide meltdown.

These bandages could help us limp along, but they do not address the core issues for the long-run.


We can create public banks that serve as revolving fund community development banks, significantly reducing the cost of community development. These banks may be able to create money like other private commercial banks. Public banks can be a valuable bridge, saving communities millions on private bank interest ASAP. They can also be useful after a change to the new money system; they can serve as distributors of money created by our federal government, encouraging local participation in the spending decisions. However, in our current system, while public banks shift some power to states, and save taxpayers money on public investments, bankers are still creating the bulk of the money supply. So again, the core problems of exponential growth and inequality are not addressed.

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