Savings, Loans and Insurance entities

Savings, loans and insurance

Old style Savings Banks work very well

With the disappearance of the privilege of seignorage as a source of income, there will be diversion to investment in green business. The reinvention for the 21st century of safe regional savings and loans banks, savings pools, building societies, mutual insurance societies would be encouraged so that people could borrow money from others at a local level. Without the privilege of being able to create the nation's money supply at a profit,  banks would then have 100% reserve, thus reverting to Savings and Loans Banks which lend out depositors' money. David Korten in his New Economy Working Group Report, How to Liberate American from Wall Street Rule, has  suggested that the system of community banks, mutual savings and loans and credit unions is one with proven capacity to perform the desired functions. It worked throughout the 1940s to the 1960s. It was well regulated and decentralised banking system and provides a model to restore financial and economic integrity.  

Financial Transaction Tax

Goldman Sachs is one of the biggest building in many major cities and their CEOs received huge bonuses after being bailed out by the taxpayer

Goldman Sachs rules the world

Financial Transaction Tax.

In line with our policy to tax unearned income not earned income we would impose a Financial Transaction Tax. Money was intended as a method by which goods and services are distributed at an agreed value. Money was never meant to be a commodity in itself.
In 2008, prior to the global financial crisis, world trade in various financial commodities was 74 times higher than global GDP. Daily turnover for global currency trade as of April 2010 was $4 trillion ($1,460 trillion a year). This speculative activity is destabilising the world economy and creating speculative bubbles that ultimately hurt grassroots people.
The world of international finance has become a global casino where investors seeking quick profits bet huge sums of money around the clock.High frequency trading has got out of control and one commentator suggested our financial system "needs some sand in the gears to slow it down." Wildly fluctuating currency values play havoc with exporters confidence to create jobs.

More than US$4 trillion is traded every day, and 95% of this is from speculators while 5% is to facilitate real trade. An explosion of high speed, high frequency trading carried out by computers is causing an increasing number of ‘flash crashes’ and undermining markets’ role in efficiently allocating resources.
The Kiwi dollar is currently the tenth most traded currencies in the world.
A thousand economists wrote to G20 finance ministers meeting in Washington in April 2011 urging them to tax speculators to help the world’s poor. In a show of unity rare in the economics profession, the experts from 53 countries describe the so-called “Robin Hood tax” or Tobin Tax on transactions in financial markets as “an idea that has come of age”.Supporters range from Bill Gates to the Archbishop of Canterbury.


We support a tax on currency speculation to limit high frequency trading. This was originally called the Tobin Tax but more recently called the Robin Hood Tax or Hone Heke Tax. This places a small tax on all financial trades, raises considerable revenue and is highly effective. It has a negligible effect on real investment but will render most high-speed computerised trading unprofitable.
The current size of the derivatives market is now a mind-blowing $1.4 quadrillion.  which is 23 times the value of the world's GDP. How big is that? If you started counting at one dollar per second, it would take 32 million years to count to one quadrillion dollars.

FTT is administered by the banks. The tax will be collected through data bank facilities on every bank transaction at point of withdrawal. The percentages rates that are being talked about internationally for Financial Transaction Taxes are very small, ranging from 1% to as low as 0.05%. We suggest putting a .01% FTT on all trades of derivatives and a 0.1% FTT on all trades of stocks and bonds.
The Robin Hood Tax is justice. The banks can afford it. The systems are in place to collect it. It won’t negatively affect ordinary members of the public, their bank accounts or their savings. It’s fair, it’s timely, and it’s possible. The feral banking economy must to be brought under control.
A Financial Transaction Tax (FTT) would be like GST for the financial sector. In NZ financial services do not currently incur GST. FTTs collected via the electronic bank settlement process would be impossible to avoid.

Resource rentals

b)             Resource Rentals Untaxing the productive economy creates wealth while taxing nature conserves the planet. We would tax the use of land, metals, oil, electromagnetic waves, water, agricultural quotas, and any resource which is part of the commons. The principle is that we pay for what we hold or take, but not what we do or make (unless we make them using precious resources or the product is environmentally or socially harmful.) All private companies which sell basic natural resources will pay an annual rental to the public purse. If hydro electric power stations currently owned by Government were sold to private owners, then the new owners would have to pay a water tax for our public revenue. Water tax. The worldwide demand for water is predicted to increase steeply and we have no reason to believe New Zealand will be an exception to this trend. The irrigation tax proposed by the Greens is a good example of a resource tax. It is a tax on the use of a scarce common resource, water for personal gain. If farmers were taxed according to the resources they used, then water intensive farming would not be as profitable as dry farming. Dairy farms would give way to sheep and beef farms and horticulture, thus reversing the trend to dried up and polluted rivers. It would also mean overseas owned utilities and monoculture agribusiness would start to pay their fair share of tax. Likewise a resource tax on scarce resources like oil would include petroleum based fertilisers and pesticides. This  would hasten the move to organics. Another effect would be to minimise taxes for sustainable farming and consumers with a low carbon footprint. Changing to resource taxes would simplify the tax system. China has of late moved towards a rare earth tax and has adjusted its coal taxes upwards. Australia is proposing a tax on mining.

An Interest-free International currency needed for international trade

International currency for international trade. After prolonged and bitter debate, the international agreement at Bretton Woods in 1944 was to use the USA dollar backed by gold as the international currency, but this has given an unfair advantage to USA ever since. If people in a mutual credit scheme like a LETS scheme or a trade Barter Company can trade with each other without interest being paid, so can nations. We would argue for an international currency with a clearing facility so we would promote an International Clearing Union with export credit accounts for trading among member nations. In the banking crises of 1998 the Malaysian president brought in a policy to stop their currency from being used outside their country. If it came to Malaysia from the outside it was deemed worthless. This was a recognition of the principle of managed borders. Its economy as a result did not collapse to the extent that Indonesia’s and Thailand’s did and the IMF ended up noticing this. The most powerful international currency we could use would be one invented by economist Richard Douthwaite of Ireland.

Trade dollars acceptable for paying tax

Currencies of Barter Companies Barter companies offer great advantages to small and medium sized businesses. Active membership of a barter company can increase the customer base of a business, sell excess stock and bring new trade.But governments have failed to recognise the alternative currencies of the trade dollars. The currencies of barter companies currencies would be acceptable in the payment of tax at national level. These are generally referred to as Trade Dollars. The Inland Revenue Department has too long been inflexible in this regard. If they accepted the currency they could easily spend it with one of the members of the barter company. In New Zealand Bartercard has 75,000 members worldwide who could provide goods or services to government. It is time Government supported barter companies.   This section needs work done on it.

Community Currencies encouraged

Community currencies. Many trades do not require precious national currency or even a regional currency like an Auckland currency. At the community level a variety of currencies are possible and the X Party would encourage diversity. The recent spread of timebanks, where members in a community help each other and pay in Hours, is encouraging because it helps with building social capital and strengthens that community. Everyone's Hours are equal. Organisations can join and teaching and learning can occur. The establishment of timebanks in every community would be encouraged so that people can exchange skills on an equal basis. Timebank coordinators would be funded. In this way community building can be fostered at local level for minimal cost. Local Economic Trading Systems like the ones in Golden Bay and Wairarapa will be encouraged. Local communities can establish local vouchers for the exchange of goods in their district. Local businesses would accept local vouchers backed by a certain quantity of goods produced in the area. One model for success is the Chiemgauer in Germany.

Green Monetary Reform

GREEN MONETARY REFORM Nearly every relationship essential to life depends on money. This gives ultimate power to those who control the creation and allocation of money. Most of our money is issued by private banks that manage it for the exclusive benefit of their top managers and largest shareholders. It is issued as debt to be repaid with interest. Not all borrowers can repay their loans with interest at the same time because there is not enough money in the system. So this requires at least one borrower to raise a new loan and so the total money supply must keep on increasing. This system leads to growing debt, a growing money supply and therefore the imperative for perpetual economic growth. This imposes an ever-increasing demand on the natural resources required for productivity growth - not to mention the social harm that results from a system of ‘winners and losers’. It widens the gap between the rich who are net lenders and the poor who are net borrowers. Few people in the New Zealand realise that they are using privately created money without knowing it – and using a private service always comes with a price tag. Any properly functioning economic system has as its purpose the provision of goods and services for a community. It is putting the cart before the horse if money supply is allowed to govern production. The financial needs of production and distribution should determine the money supply. It is only when there is enough money (whether national, regional or local) in the system that there can be full employment. If we don't have full employment there is no hope for our youth and a complete breakdown of systems may be just around the corner. Full employment is not possible with a centralised money system linked to a global system dominated and tightly controlled by big banks, investment banks and wealth management companies. A central service of governments — supplying money — has been privatised and it has been done by stealth in the western world. The private interest-bearing money must be abolished and replaced by public money put into circulation by public bodies at all levels.  We would vest this money creation power throughout the community at different levels of organisation. There would be continuing negotiation between the levels to create a dynamic equilibrium.