Plutocracy vs. Democracy

November 20th, 2011
in Op Ed

by Derryl Hermanutz

worshipping-money"The new ECB president, Mario Draghi, also brushed off the political pressure, saying the central bank's overriding task was to safeguard price stability and that governments must get their finances in order so as to buck the crisis."  Sydney Morning Herald November 20, 2011

"Price stability" is code for "preserving the purchasing power of money".  What this amounts to in fact is monetary repression that causes economic price deflation that makes money even MORE valuable in terms of what it can buy.

Follow up:

Once again, this is a moneycentric perspective on economics that sees the value of money as the only valid economic indicator. Minds infected with moneycentrism see economic depression and human wastage as, not merely unavoidable collateral 'costs', but positive and benevolent moral duties of those who would virtuously and heroically defend the interests of money against the interests of humanity.

About 35 years ago when I first became aware that this is going on I thought there must be some kind of Satanic spiritual influence corrupting the minds of the defenders of moneycentrism. I didn't see how this could be an expression of any kind of interest that I was prepared to recognize as "human".  Indeed, the Biblical depiction of the false god Mammon (money worship) supported my hypothesis.

But as I became more historically informed I learned that this does indeed express the interests of a certain kind of man-like creature called a "bond merchant", whose stock-in-trade is his ability to create the illusion of money called "credit" which he extends to governments to finance their wars and other expensive adventures.  The loans of course indebt the nations to the bond merchants who thereafter enjoy princely powers and privileges within the realm.   Read, for e.g., Niall Ferguson's account (in The Ascent of Money) of the status of Cosimo de' Medici in mid-15th c Florence,

"By the time Pius II became Pope in 1458, Giovanni's son Cosimo de' Medici effectively was the Florentine state. As the Pope himself put it: 'Political questions are settled at his house. The man he chooses holds office...He it is who decides peace and war and controls the laws...He is king in everything but name.'. Foreign rulers were advised to communicate with him personally and not to waste their time by approaching anyone else in Florence."

There have always been men among us who desire this kind of absolute power and who will employ any and every devious device they can conjure to acquire it. There is but one imperative: Prevail. These power mongers and their intellectual apologists have succeeded in deceiving the whole world with their money illusion. We are ruled not by flesh and blood men but by an idea, by immaterial numbers. We must prostrate our nations before and sacrifice our human interests to the inexorable dictates of Almighty Numbers.

This is the ancient spiritual war that MMT (Modern Monetary Theory) is presently engaging.  MMT seeks to reassert democratic human authority over our money numbers.  Money's plutocratic defenders and beneficiaries are warring back with their "sound money" and "fiscal prudence" rhetoric, and their dire predictions of apocalyptic ruin if we fail to render due obeisance to their Money-god.

And in fact the agents of that god do possess the power to visit those calamities upon us if they win this present battle over control of money issuance. If bankers, representing the moneycentric perspective, win the day, there will be austerity and economic depression and money will become even more valuable and powerful. If monetary reformers, representing the economycentric perspective, prevail, then by restoring money issuing power to representative governments we may be able to create the beginnings of an economic recovery and a return to the kind of widely distributed economic prosperity that our industrial economy is so eminently capable of delivering.

Money issuance is the key. By bankers: plutocracy. By governments: democracy.

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About the Author

Derryl Hermanutz has contributed (opinion and analysis) previously on topics related to theory of money and relationships between current events and economic history and philosophy.

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  1. Joe Firestone says :

    I love this piece Derryl! It speaks the truth!

  2. Pito says :

    Money is an illusion of the mind. Yet the illusionist holds the world captivated as he manipulates your perception of reality.
    We trade the days of our lives and fruits of our labor to participate in the illusion.

  3. umbrarchist says :

    Double-entry accounting is 700 years old. Why hasn't it been mandatory in our schools for the last 50 years? If everybody knew it then maybe the problem would not have gotten this bad.

    Whose fault is it that it has not been mandatory?



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