Consider this post in the AMI's google group.
The Fed, Environmental Destruction and
How to Fund a Sustainable Energy Infrastructure
By Jamie Walton, with contributions from Mike Holden, Howard Switzer, Joe Bongiovanni, and Mark Young; participants at AMI conferences, and on the AMI Google Group forum
(go to: https://groups.google.com/forum/?hl=en#!forum/the-american-monetary-institute)
October 20, 2014
The Fed (the Federal Reserve System) is the back-stop, bailor-outer and get-out-of-jail-free-card-dispenser for the banking system. The banking system creates the bulk of what we used for money (so-called “deposits”) whenever a bank makes a loan or purchase, by using the same bookkeeping procedure as though someone had actually deposited some cash with the bank for safekeeping (don’t worry, in no way does this procedure make any real sense, but we’re not going to go into that here).
The end result is that every dollar in circulation has a dollar of interest-bearing debt tied to it, somewhere in the banking system; as all bank deposits are matched by more than an equal amount of loans, mortgages, lines of credit, etc., on the collective balance sheets of the banking system. This means that every dollar in circulation today has to eventually be paid back to the banking system, with interest.
To satisfy this condition, banks will endeavor to only make loans (or bond purchases, etc.), that they think will be able to be paid back, with interest. This means that the borrower has to do something which generates at least enough income to service the debt, i.e., some sort of “commercially viable” activity. While commercial activities can produce many of the goods and services we want, they often do so at great uncounted cost to the environment. For example, cutting down the Amazon rainforest for cattle grazing. The cattle graziers don’t pay for the loss of oxygen in the atmosphere (this is called an “externality”). Likewise, no bank is going to lend money to someone to plant trees and not cut them down, because there is no way this will generate income to service the loan.
To solve the real environmental problems we need face up to today, we need money that doesn’t need to be paid back. The National Emergency Employment Defense (NEED) Act provides us with a money system where money can be invested in environmental projects and doesn’t need to be paid back with more money, because that money is debt-free sovereign money (like only our coins are now). Instead, we can enjoy the payback in the form of cleaner air to breath, cleaner rivers and oceans, less soil erosion, and so on. These are real environmental benefits for humanity and all life on earth that may be beyond measure, but in any real conservative analysis must be seen as far outweighing the initial investment in dollars.
Due to the processes described in brief above, the present debt-money system run by the banking system is driving environmental destruction everywhere. Obviously, a system that is driving environmental destruction cannot be used for environmental restoration.
The NEED Act provides us with the means to embark on the critical transformation that we need to make towards a sustainable path, by enabling us to really and truly invest, to the full extent required, in environmental restoration and conservation projects, and in new eco-friendly infrastructure projects. See here for more background and explanation.
How to Fund a Sustainable Energy Infrastructure
What is a sustainable energy infrastructure?
It must be renewable or inexhaustible, and it must be non-polluting.
As discussed above, the debt-money system run by the banking system is not amenable to investments to protect our environment, nor the kind of concerted and co-ordinated pure research and development we need to undertake to get right away from non-renewable and unsustainable energy sources. Only national efforts with national funding can do this.
To prove the point, here’s an example of some of the technologies we use every day that were funded by the U.S. Government and other nation’s governments1, and which probably wouldn’t exist if it had been left up to private entities:
CPUs (Central Processing Units); integrated circuits, in microprocessors in computers.
DRAM (Dynamic Random-Access Memory); memory in computers.
HDDs (Hard Drive Disks); hard drive storage for computers.
LCDs (Liquid Crystal Displays); color screens on some computers and TVs.
Li-ion (Lithium ion) or lithium polymer batteries, used in electronic devices.
DSP (Digital Signal Processing); converts analog signals to digital form.
FFT (Fast Fourier Transform) algorithms, used for computer calculations.
Cellular technology and networks, used by mobile phones/devices.
GPS (Global Positioning System); used by mobile phones/devices.
Click-wheel navigation and multi-touch screens; used on electronic devices.
SIRI – AI with a voice-user interface; used in iPads and iPhones.
Internet and HTTP/HTML; the world wide web of computer and phone connectivity and the computer language which helps it to work.
What’s needed is a national government initiative, a national research and development program akin to a 21st Century “Manhattan Project" for a sustainable energy infrastructure
The NEED Act provides the means to be able to fund this national effort without more debt and more taxes. It provides debt-free sovereign money which can be invested in the betterment of our future without having to be paid back; we can get the payback in the form of a cleaner environment, without any financial burden on future generations.
It would make pragmatic sense to go for the low-hanging fruits first, by fully developing the technologies we already know about but haven’t fully developed to their full potential, such as non-interrupting hydro2, geothermal, wind, solar, wave and tidal.
As the national research and development effort continues, we may find way to harness the sea of energy in which the Earth floats. Such technological discoveries are really discoveries of nature, and nature shouldn’t be patentable - we should see this as part of our common wealth. The NEED Act gives us the key and catalyst for a sustainable future.
1 Courtesy of Mike Holden, AMI member in Michigan.
2 There are methods of harnessing energy from rivers that don’t involve interrupting the flow of the river.