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1. all PERSONAL DEBTS in International (Pounds) money are are wiped from the banking system and all credits are converted to Engros on a balance multiplied by 2 basis.

2. All BUSINESS DEBTS in Pound-type-money are wiped from the banking system and credits remain as Pounds, again, multiplied by 2.

3. All Existing Cash under the mattress will be exchangeable for twice as many Engros (as the paper Pound will disappear – business should have no use for cash in a modern society).

4. All government bond debts are similarly cancelled. All government bond holders receive bond-value x 2 in International Money of whatever denomination (every country simply prints it in effect).

5. Charging and receiving interest on Engros is outlawed as usury.

6. Seizing Engros to pay business interest or loans would also be outlawed.

7. Charging and receiving interest on Pounds is left to the “free market”.

8. All shares on all exchanges remain in whatever International Money they are held in.

9. Internal exchange rates for Engro to Pounds are set by government and are envisaged to be extremely stable.

10. All increases in the internal money supply in Engros is routed through the population in the form of:

11. Introduction of the National-Income for EVERY legal citizen in the country with special rules and conditions and protection for under 18s, pensioners and the certifiably unable to work. The first payment to be made (or made available in cash) on debt jubilee day requiring the override proviso being that you MUST be “working” or in work as the payments will be made via your employer (see later explanation):

12. Scrapping of all benefits/tax credits etc for those able to work.

13. Governments supplying direct credit or loans (in Pounds or Engros) to business and especially banks is also outlawed.

14. All Paper Pounds & coins are withdrawn from circulation during a set period until:

15. Engro to Pounds conversion is only available via government owned banks.

16. A new taxation system is introduced. There would only be 2 taxes. a) VAT. b) Engro / Pound Exchange tax.

17. For international import businesses selling locally taxation would occur at the point where Engros are exchanged for Pounds (for use in buying more imports). For international businesses exporting goods and receiving payment in either Pounds or another currency, corporate taxation would effectively be zero at that point, encouraging export over import. For local businesses taxation would be via “differential VAT”(not explained here). Improving tax take and encouraging smaller businesses. Taxation occurs on wages that are paid by using Pounds as the source when they are converted by the company to Engros. Taxation on pure Engro wages are not taxed at source but through VAT.

     

As a pleb with a pocket calculator I can work out that our current growth-to-survive and money systems will fail within about 30-50 years. We are hitting the top end of an exponential rising curve, the part where it literally starts going straight up.

See this for an idea of the increases recently

We are still told that we need world wide growth to solve the recession problem. Europe has just allocated nearly 1Trillion Euros to “lend” to EU countries. The US needs even more trillions to keep going. All over the world every country is saying “we must export more to solve the debt problem” Who to? Is the pertinent question. Who is going to buy all these products?

The start of the answer to the question has to be a personal, national and international Debt Jubilee or Global Default on loans if you prefer. Currently money is out of control, there is not enough money neither will there ever BE enough money to repay all these trillions of global debt. There is of course a downside to global debt default when using current thinking - it would wipe out our banking systems and our means of paying for everything, even water, food and heat the necessities for life.

So a controlled way has to be found

“Personal / internal” (The Engro/Scotro.Welshro/Frenchro/Greecero, Amero) money and “business / Investment” (The Pound, The Euro, The Dollar etc.) money separation. For this discussion I will use the Engro and the Pound.

The debt jubilee has to coincide with the introduction of something like the Engro and the removal from commercial banks of the ability to create the local Engro money that is used for general trading within a countries borders This right should return to government owned central banks who can create debt free Engros i.e. it does not have to be borrowed into existence and they never have to be paid back except as taxes. It is simply created and credited to accounts as needed. I think this used to be called “the money supply” and was controlled to avoid the situation that we have now. The Engro would be exchangeable for The Pound only (International business money). Which are exchangeable for Euros/Dollars etc.

Tomorrow: Inside a country on the Debt Jubilee Day (DJD) must award it an acronym :).

>>But governments don’t set themselves the objective of actually repaying public >>debt - they are merely concerned to maintain its manageability

I assume you mean “revolving debt” on a national basis, what us in Pocket Calculator world would call Credit Card Debt. You pay some off but then by the end of the month you spend it again. Hence you keep paying the interest on a fixed sum - and that is what has to stay manageable - Paying chunks of national wonga to our bond holders, read banks, insurance companies, pension funds and foreign investors.

By the time you have six credit card you are suffering badly!! I know I’ve been there.

This has to stop at some point. So we should be asking our new government - What’s the plan to get out from under the debt yoke?

We all know that if you make the minimum payments on a large credit card debt, you will be paying for ever - which is what the card company / bond markets/ foreign investors want. UK plc has to find  a faster, better way of repayment not continue paying the interest ad infinitum!

What is that way? In the past we would have said - “Growth” - simple arithmetic again - stimulate the economy - create more taxpayers - get higher income - pay off some debt. Have a little bit of inflation because that helps reduce the burden of the debt over time too.

Today there are a few problems to say the least…

Our industries have been decimated, let’s not kid ourselves, they were never fantastic except perhaps in the distant past, and even then we relied on cheap materials and extraction from the Empire. It was not really a fantastic feat was it? We had a third of the world, strictly controlled, often beaten into submission, as a resource funnelled into a tiny island. Well, forgive me, hardly difficult to make few bob was it.

Those are the times that we have been made to pay for, we the “Great British” gave every one of those “common wealth” peoples a right to live in blighty and a claim on our future. What could go wrong? We ruled the waves and the economy of the world! AND we are “Great”…

What went wrong, we all know, the world changed and we tried not to. We still want to play in the big boys playground, but we are diminished, shrunk, a raggety band of pen pushing paper shufflers collecting a few fees for said scribbling and shuffling. Bolstered by our arrogance and our wallowing in our past “glories”.

What industry we do have is not ours. We have paid the credit card bills by selling our furniture and worse we are now down to selling our tools - the tools we use to make a living, few it seems are left.

The rest of he world must look on and chuckle. “Great” Britain, hmm.. since when.. “special” relationships, hmm…here boy…  Sort-of part of Europe when it suits them, hmmm..grumble, grumble, Saves the world…hmm.. The Great British working mans spirit and ingenuity, hmmm.. half mostly employed ingeniously getting the tv to get free channels and to calculate the cheapest beers at the super market per % alcohol…hmmm… Saves the world again! hmm..

We need to start saving ourselves. We need a new attitude. We need to firstly realise that the economic restraint and prudence that we preach at others actually applies to us too. The free ride and credit rating, granted by the rest of the world due to our history is over. We have never defaulted on our debt. No, we always pay up! we are the Great Brits, whatever are you thinking! Well, maybe we should… The business world is tough world they say - and this is business of the most serious order. One sting is all we need. Deep deep doo-doo would result but hey we will only have the Great British Pound for so much longer, so why not send it off with a bang. Not his terminal cancerous decline.

If you don’t fancy that well, what do we have left, apart from paper shuffling?

Brains, Science, inventors and oh yes, that ingenuity.

Brown is right on one thing only in my mind - Investment. Investment is what we need. So where are the opportunities in this changed world?

Energy.

Energy drives everything, and in todays world that means oil. But spot the problem… oil has been done, and is done for eventually. So what takes its place? Renewable/sustainable energy  technology and energy frugalism. That’s what. There is ultimately no other answer. That is where we need to be. While the rest of the world bickers over degrees of co2 and smokestack emmissions, we should be beavering as if it is the beginning of world war 2 and we need Radar, Spitfires and Hurricanes. We just don’t know we need them, we don’t know what they are yet, but know we will need them. So we should beaver rapidly to discover what these future things will be.

In an earlier post - hat tip DevilsIntheDetail We see how continued 3% growth adds 30% to GDP in 10 years. If we do the same sums for the DECLINE of oil we end up over 20% down in the opposite direction. Giving a 50% gap between available energy and required national output. So it can’t be done. It’s not achievable! As our new incoming prime minister will probably be told in a few days time. At which point he will instantly age 10 years - it happens to every new prime minister! He now knows he is driving a piffling force (the UK economy) into an immovable object (the peak oil problem). It’s no wonder these poor guys end up with short term aims - the long term aim is just too difficult to contemplate.

So THIS IS the most important election for centuries. Our new prime minister needs to turn the wheels of the economy and point them NOT at growth, but directly at energy investment, energy research and energy saving and distriution technology. We don’t need shiny electric cars and other such showcase items, don’t waste effort and money on glitzy consumables we need future things, solid lasting things.

ENERGY not BANKING is the future. We need to use the dregs of our credit card limits to set this up.  We need to use the unemployed/economically inactive to insulate every state building. We need to nationalise our energy grid and suppliers. Stop the stupid competing and lining the pockets of foreign share holders.  Re-align the industry to point it directly at the future. Use the “profits” to create small scale feed-ins and community projects. All state owned, this time with the remit to be actually for the people, not for profit.

It IS an emergency as big as a war! So we get kicked out of the E.U. for doing it, ho hum they’ll be back (a little arrogance is not necessarily bad).

If we do not do this - we will freeze to death in the dark in the not too distant future. There are good people here, clever people. We need to stop beating on them and support them. We need bold steps.

Oops, seem to have rambled.

I rambled so much that the  BBC closed the comments before I could post it

Go, vote!

The (only just still current) government’s highest forecast for growth = 3-4%.
Lets say 3% growth for 10 years.

Current GDP is Circa £1.5 trillion 10 years growth at 3% results in GDP of £2.015 Trillion in 2020, a real increase of nearly one third or 515 Billion over 10 years. So lets go forward 10 years and apply Taxation to this increase in productivity at current base levels (approx. 38%).

This gives us £195 Billion extra income to the exchequer in the 10th year. (With a lot of luck and a lot of hard working taxpayers and a lot of export profits.) I realise taxed Company earnings/profits, VAT and duties and other taxes raise more but I’m assuming we need those to run the rest of the country not just pay debts. So lets just say that is it, in simplistic taxpayer terms.

The deficits for the next few years are going to be horrendous, it is estimated at about 170 billion for year 1. Add Interest at current Guilt yields of 4% ish and in 10 years time we have paid interest of 68 billion on the original 170 billion. Total 238 Billion.

So in the 10th year, all the taxpayers additional earnings can’t pay back all of what we borrowed in year 1 So reversing the sum what we really need in 10 years time (to pay back year 1) is 238/38*100 = 626 Billion in Growth which is 3.5% Growth - hence the chancellor’s 3.5% forecast to keep the markets happy until after the election. When they will admit this is highly unlikely and revert to half from growth and half from taxation & cuts. Simples.

To put this in context: There are around 32 million tax payers. So over 10 years the taxpayers have to increase their output (earnings) by 515,000 / 32 = £16,100 each which is £1,600 per year on average. OR they have to be taxed that much extra. And that figure is (given an average earnings figure of 26,000) 6% extra starting now! I don’t see the growth (0.00x% gets us absolutely nowhere!) So tax it is then.

We are really really going to struggle to pay this off.

Getting back on topic and to the point, Greece has a population of approx 12 million. At the same ratio as us they have approx. 6 million taxpayers. They have just borrowed 100 billion Euros ish at 5%. Their GDP is currently around 350 Billion Euros…. They think they are going to pay that back with cuts? It seems to me they need 4% growth just to pay the interest and 7% to repay the capital at 10 billion per year( over 10 years) that’s 11%. But they are saying 4 years? Greece must go bust.

I am but a lowly pleb with a calculator, so someone, possible a master of the universe, tell me what is wrong with my calculations?

In my personal view, national and international “Debt Jubilee” - is starting to look like the only way.

Update 6th May:

It looks like Martin Wolf agrees with me

Comment to Rob Killick’s article of a similar name but opposite meaning.

I commented because this particular proposition - that we must stagnate and or go back to the stone age in order to protect the environment, really gets up my nose.  What is wrong with people’s imagination? We must have a new Industrial Revolution possibly known as the tech-tronic-dustrial revolution. We are at the beginning of the digital electronic revolution, not the end. We have the technology and the knowledge - we lack the will us it.

Why do we lack the will? We don’t. The industrialists do.

Examples:

1.  Food.

There is enough growing space and enough seed and water to feed the world’s population. It’s just that we don’t grow food to feed people! The industrialists grow food, market food and ship food to make money. Not to feed us all, simply to make money.

2. Energy.

There is enough energy available to power our homes using solar and wind generated electricity. We need different homes, not ones built while, and following the designs of ones built, when the steam engine ruled.

Back to my comment:

Rob,

Along with others, I don’t know where you get this idea from. Who is suggesting we destroy our economy? Who is suggesting the we compromise our way of life? If we leave the extreme-greenie-hippy-back-to-nature-groups out of this who is suggesting it?

What most people who recognise the dangers in what we are doing to the planet (even putting “Global Warming” to one side) is that we must change what we are doing to preserve our environment. This is obviously in danger of deteriorating to a point where it can’t support us all. We can’t ALL do this by living in tents and caravans and harvesting berries, there are just too many of us. We will need high technology to change the current balance from taking too much from our surroundings to putting something back , or at least, leaving what is there for the next generation to use. This seems to me just simple common sense.

What seems blatantly obvious to me should happen is that having invested umpteen billions in the financial system – when it is taken back (For the money to be vaporised back to where it came from – thin air.) We DO NOT vaporise it but we start the biggest rebuilding of our transportation system, our industrial base, our scientific community and our personal living conditions since the start of the original industrial revolution. If we can create £500 Billion to give to banks and survive virtually unpunished on the world stage we can do it again to secure our environmental and energy future. We DO NOT wait for the rest of the world, we lead, we invent, we demonstrate as we have in the past.

We get people working, DOING STUFF that benefits us all, Building, Insulating – tear down the worst – whole towns if we have too – and rebuild using 21st century knowledge and technology. Gut the petrol and diesel cars and retro fit electric propulsion – don’t tell me it can’t be done. Why waste what is already there?

Invent, Design and build the electrical networks and switching mechanisms that are required to handle disparate, differently sized intermittent AC and DC power and base load generation. Get the farms working again get PEOPLE back to farming and being interactive with the land – our farms are dying – the soil is dying from over fertilisation and over mono-cropping (is that a word?). Did you know that birds no longer follow tractors to get the bugs and worms turned up by the ploughing? Why – there are none to get – the birds have given it up as a bad source of food – that worries me that one fact! Get rid of SOME of the problems – Investigate and fix the problem with the Bees – Surely we could do that?

We are a small enough, densely populated enough country to make it all viable as an experiment. We do not have the vast distances that need covering in the US, China, Canada or Africa. We are small enough to be the experiment.

Then we sell our newly gained knowledge and our experience to the rest of the world. They are going to need it after peak oil/gas if they don’t start now. This is the type of “New world” that we can create – get a jump on the competition. This is the type of vision that the UK people need – something to strive for – something that has underlying good at its heart, something to be proud of as a nation. Some thing that will actually pay back to the people not to global banks, businesses and as you mentioned it, dictators.

If you are concerned about what happens when you give a few people a lot of money and few rules - you should read this article on counterpunch

nuff said.

More sense from politicians! Twice in two days - I’ll need time to recover.

See BBC news Today

I see nef have given this a cheer too on their blog

Not been any time for blog writing this week or month! my apologies to my subscriber - Indeed I have just one! (thank you!). So I am encouraged to write something new.
I see that other voices are taking up one of my (not unique) ideas to turn the Post Office network into something we, the people, can use. See this post on nefs Triple Crunch Blog

Also no supported by Peter Mandelson as out lined here on BBC News

There are parts of the wordpress editor missing today I am actually having to write this in pure html - no additional tools seem to be available or work so I will give up for tonight and try again tomorrow.

I’ll try to get a new page of the book done too! Otherwsie it will take a literal year of Sundays

Today I posted my first comment to someone else’s blog concerning the proposed windfall tax on energy. I mostly just think about posting,  I’m getting brave!

But the shilly-shallying of these massive (Non-UK) companies when it comes to their social responsibilities makes my blood boil! In essence I say to the government - Give them an ultimatum - voluntarily help those in need or pay the tax! I also say that a voluntary agreement would be more likely if these companies, that are vital to the nations well being, were actually still owned in the UK.

I don’t know if these Spanish, French and German companies are going to be asked to help their own domestic customers in the same way, but if that is likely is is also not likely that they would take the line “charity begins at home”. It raises another point in my mind - if we are all a jolly-joined-up caring Eurpean Community isn’t the UK “home” too?