A NEW ECONOMIC MODEL
A total transformation of the money and tax system is required to address the multiple crises we face. We need a new economic model that works for all Life.
We want a political economy designed to mimic Nature. Centralisation and monocultures are not Nature’s model. In all our policies we try to imitate Nature’s model of organisation.
The economic metamorphosis we propose will move away from tax on work and production towards tax on resource use. Our philosophy is that nobody should profit from owning land. Land location values should be shared, so “owners” of land and other natural monopolies must pay an annual rent to the public for the privilege, instead of paying income tax or rates. People currently have their earned income confiscated by government, while they are praised for getting a windfall gain from sale of their property. This is unacceptable. While we continue to allow the private capture of land value gains, both banks and property owners will benefit and the money supply will have to keep increasing. The gap between land “owners” and the rest will keep widening.
We will change the way money is created. The current interest-bearing debt money system drives the world-devouring engine of perpetual growth, causes growing debt and massive environmental harm. The profit making bank-created money system we live with is a monoculture that causes people to behave competitively in a dog-eat-dog world. We want multiple currencies co-existing. We are suggesting that the country’s national money should be publicly created at community level and the revenues flow from the periphery to central government. There would be a variety of feedback loops involving strict controls on inflation. Until we change the money system we change nothing. Change it and you help all of the above including climate change.
A full description of what our group came up with is in the book by Deirdre Kent The Big Shift: Rethinking Money, Tax, Welfare and Governance for the Next Economic System. It is available on kindle and in hard copy in New Zealand.
Equality, according to research, makes everyone happier. Inequality is the greatest predictor of a range of social ills. Other parties draw attention to the growing gap between rich and poor, but so far their proposed solutions usually rely on centralist solutions and do not encourage green business. They also keep wanting to tax work and enterprise. You cannot solve today’s problems with yesterday’s solutions.
We recognise that solving a range of intractable interconnected problems together is a major political challenge. It must be done using systems thinking.
A change to Community Land Trust leasehold land is indicated. Public creation of money without interest bearing debt is also imperative. Public revenues must be shared by using the revenue straight away to issue Citizens Dividends. Solutions are offered on this site including ones which will surprise the reader.
We also want a new paradigm in governance. We want to turn the dominant paradigm of governance upside down. Instead of power being at the centre and distributed to the periphery, we want the power residing in the periphery but distributed to the centre.<p> </p>In this model, the community board would not only have a fundamental right to exist, it would have full sovereignty. Its powers would include:-
In this model, the community board would not only have a fundamental right to exist, it would have full sovereignty. Its powers would include
- Revenue gathering powers (imposing rents on the exclusive use of the commons)
- Currency creation powers (spending money into existence and designing a circulation incentive)
- Welfare/tax reform power, distributing unconditional Citizens Dividends to all citizens.
- Rule making power (including the power to choose the tax rules for trade in its currency)
- Power to protect its citizens and give them opportunity for growth.
- Land purchasing powers.
Many functions, of course, are not possible locally. It is not appropriate for the Community Board to take charge of major roads, rails, the bioregional function of flood protection or the defence of the country. It will delegate this power to a larger organisational group (Council, a larger Unitary Authority or central government)
So instead of having a central authority that overrides the decisions of councils or community boards, the wishes of the community board have precedent for their area.
Our solutions will go a long way to tackling resource depletion, climate change, environmental damage, unemployment and poverty, while at the same time unleashing the human creativity and entrepreneurial spirit required to meet the big challenges ahead.
The post fossil fuel economy, should be what Herman Daly called “a steady state economy”. Within that steady state there is constant and dynamic change as old things die and new life is created. In this system, resilience will bear more weight than efficiency. We need to get the balance right.
Without these fundamental paradigm shifts, the future could be brutal – the old economy will struggle in its death throes while the new one emerges. Our party will be a catalyst in birthing this new economy and give New Zealand a measure of resilience to withstand the shock coming our way.
When talking about the $37 billion that is captured by private landowners every year, we are reminded of the quote from Henry George, author of Progress and Poverty. He said “For this robbery is not like the robbery of a horse or a sum of money, that ceases with the act. It is a fresh and continuous robbery, that goes on every day and every hour. It is not from the produce of the past that rent is drawn; it is from the produce of the present. It is a toll levied upon labor constantly and continuously. Every blow of the hammer, every stroke of the pick, every thrust of the shuttle, every throb of the steam engine pay it tribute. It levies upon the earnings of the men who, deep underground, risk their lives, and of those who over white surges hang to reeling masts; it claims the just reward of the capitalist and the fruits of the inventor’s patient effort; it takes little children from play and from school, and compels them to work before their bones are hard or their muscles are firm; it robs the shivering of warmth; the hungry, of food; the sick, of medicine; the anxious, of peace. It debases, and embrutes, and embitters.”
For a brief description of our major policy, go here
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Note: Deirdre Kent is now blogging on her own site deirdrekent.com
This is where her 2017 book is reviewed and where there are links to where you can buy it.
Hi Deidre and Laurence, great to hear from you again in this way !! I’m all with you – let me know what I can do. This is way overdue, thanks for kicking it off! Natalie
I feel very much aligned with your policy positions, Deirdre, Laurence and others.
A strong conviciton of mine is that we need to move to a steady state economy. It seems elementary to state that we cannot keep growing in material throughput. I wonder if you might wish to consider this as you develop your policy manifesto. I hardly need to suggest references for this – Daly, Farley, etc.. Jack (Santa Barbara) outlined what it might look like in Aotearoa in his chapter in ‘Fleeing Vesuvius’.