Fundamental Understanding
One of the most profitable business is war, but unfortunately it is no longer true when the defense department is spending more than its return on investment. For instances, America's defense spending doubled in the same period and that its economy shrunk from 32 to 23 percent of global output. Global military expenditure is about $1.7 trillion annually, and USA is accounting for over 41% of it. Many people might wondering where does all the money comes from? Mostly it is tax money and over $27.7 billion spent a year by consumer on preparing tax and the number of pages in the tax code has increased 16,775% in the past century. This probably sounds not related at all however what you can see here is such a huge spending is possible because a minority is taking from majority (via taxes), indirectly you have the rich creating wealth by taking from the average joe or the poor.
The overall picture here is not judging who is the good guy or vice versa, but what you should notice is the system we are all in, where there's a winner and loser. The problem with such system we are using is there is fear among all the participants, a winner certainly fear he/she might fall back and become a loser in the future, same as rich people worried if they might become poor and having lack of access to necessities and luxury item in their daily life. The key of solving this kind of crisis is actually technology, if you look carefully what really is the thing that creates wealth it is not money at all, instead it is resources. For example, the war I've mentioned in the first paragraph, where the rich trying to get the oil resources while on the other hand, military expense also does consume resource in order to make those weapons/tanks/aircraft, 15,654 square miles used for US bases & military complex, that's more than D.C, Massachusetts & new jersey state combined, then comes along with the tax to fund those war where behind the scenes these complicated tax scheme also does consume resources in order to get the "things" done. Let alone unprecedented amount of human labour, time & money spent on all these indirect consequences & most importantly UNNECESSARY and wasteful activity all just for the rich people/oil corporation to get hold of oil in Iraq/afghan. Does it worth it?
If you look from the overall picture, the resources on this earth planet is finite, rich people and big corporation managed to get the oil and resources with any means, but on the other hand activities to acquire these resource is not free either. Earth has only this much resource and we never take account of intelligence and smart way to manage it, whats happening is we are willing to go get something at all cost, ignoring the unforeseen consequences later. For example, going to war may seem quick and easy solution to solve energy crisis, while also making the rich richer, but these wouldn't last long and short term solution usually does not have a good outcome.
One of the most common question the rich claim is the people/consumer is paying for it, there is nothing wrong customer paying for product/services to make businessman rich. That is only part of the picture, because of the system we are in, the other people, usually consumer which have no choice but to find something else to do in order to make a living, once they get paid with their salary, consumer will spent the money on supermarket, etc. to make some businessman rich. Where is the problem in here? For example, i owned 1 of the biggest factory manufacturing food in this town, and i only hire limited amount of people. While the rest of the town population have no choice except find something else to do, banking, advertising, insurance, fishing, other industry, etc etc.. these is obviously not voluntary activities neither people is doing it because of their passion, the problem in here is actually people are forced to take part in unnecessary resource consumption(which is valuable) in order to make a living.(pay me later to buy foods ive produced for them) how long this will be able to go on? resource depletion is well documented here (refer the links at reference). so the important aspect you have to notice here is the rich managed to stay on "top" of majority, but then the rest of the people keep digging beneath of this giant ship to make a living and one day they will dig until the ship sinks and nothing will be left for everyone. The ship im talking about is the earth planet which it doesn't matter if you are rich or poor each of us eventually will be affected. The younger generation of the rich will no longer able to enjoy as much as their parent do and everyone's living standard has been reduced. The government may have heavily promoting the service based sector job, unfortunately it may have not solve the actual problem instead keeps patching the hole which coming from the system.
The Proposal
Many of our daily problems doesn't matter if you are rich or poor it has a lot to do with fear and insecurity. These feeling actually comes from our perception towards others, other than that it has nothing to do with resources or other living things beside human. If you are average joe, you have your worries if your job able to pay stable income or not, if you are businessman, you concern about profit at the end of the year, if you are shareholder of big corporation, you concern about stock prices and how your CEO able to perform. Money and business profit system has dragged & forced everyone to make a choice, each of us trying set a "territory" against our employers or against our clients if you are in business. If you are not doing that, you could have risk of not getting anything and had access to poor life.The opposite could be just the truth, what actually we need is remove those belief and barriers we had on each other, what does the rich people have anything to lose if i ask them to give up everything? this will not work if only certain amount of people agreed to this new economy, it will only work if everyone on earth has acknowledged and proper understanding about it.
By requesting everyone on earth to give up everything they had is all that is. It is that simple, for instance, a rich person have 50 cars and 10 houses. However under the perception from new economy, this is not considered rich or have high standard of living, why the 'rich' person we see today only gets to drive 50 cars and live 10 houses? this is precisely where if we gave up everything and move into this new economy, the rich person today will have virtually unlimited access to numbers of car he/she can drive in the world, live in countless type of houses available everywhere in the world, etc.. The next question usually raised by many people is how is it possible everyone can get everything without paying? One of the important aspect of understanding this type of new economy is where access to needed resource is the solution instead of owning it. With today's available technology and automation, it is already possible we convert global gdp into new 100% automated gdp. This kind of new economy system does not require any human labour in order to produce everything that people needs. Refer the links in the references, to put it simply, this new economy system is also way of life.
reference :
http://www.businessinsider.com/military-spending-budget-defense-cut...
http://www.businessinsider.com/20-more-tax-facts-that-will-make-you...
http://www.globalissues.org/article/75/world-military-spending
http://www.guardian.co.uk/environment/2011/jul/18/population-7-bill...
www.heraldsun.com.au/opinion/the-facts-are-clear-so-we-must-act-to-...
http://www.zeitnews.org/
IF U DOUBT about this new proposal, i suggest you understand our current monetary & economy system first :
Understanding Secrets of Money
im about to introduce you something that makes money. money comes from where? its from a large high-tech printer, but who owns the printer? a private printing press company owns these printer. if this is true, werent we all is in danger or possible abuse? this company could have print all the money they want and buy the entire economy, the rest of the people will be forced to work under this company. thats precisely where the central banks comes into the picture, central banks owns this money printing company they decide how much money to be print at a time. without further clarification, we could end up same issue or power abuse again, central bank could buy up entire economy and everyone else is forced to work under central bank. so in some country central banks owns by the government & some central bank is privately owned.
central banks primary function is to manage country's money supply or known as monetary policy. it includes control prices or inflation, act as regulatory for the banking system, interest rate & etc.. if you have got this far, it is important to point out that central banks do not need your money or gold/silver to put in their vault before lending it out to the public through commercial banks. the monetary system we have today is simply unlimited as it is just a number in computer. useful reference : http://www.bankofengland.co.uk/publications/quarterlybulletin/qb070... (p377 or p405) the idea of unlimited money sounds difficult to comprehend for some people, here is further info : http://www.positivemoney.org.uk/how-banks-create-money/proof-that-b...
who decides to create money? before we get into that, lets look at how our typical banks operate today. suppose lets say you are employee of a bank, should you lend the money to public or not? if you lend, you will get commission, bonus, you get to keep your job & you will also get promoted. if you dont lend, you wont get anything except get fired. so you see we have situation here bank's employee's survival(buy food, pay bills, shelter, etc) is threaten if they do not lend. back to the question, who decides to create money? as the professor charles goodhart puts it "the supply of money is actually determined primarily by the demand of borrowers to take out loans.." his book info : http://www.positivemoney.org.uk/where-does-money-come-from-book/
if you look at macroeconomic subject, central bank's job is also controlling prices stability. central bank can control inflation by increase or reduce money supply in the economy. inflation goes up when central bank print more money to buy government bonds, bills or gov issued notes. in order to lower inflation, central bank sells gov bond in open market, indirectly takes out the cash from the economy. gov create bond papers and sell to central bank because gov needs money, money usually used to pay gov employee, country's infrastructure development & increase economy growth. as the old saying goes, more money supply but limited number of goods and services will devalue the money, thus increase of prices.
one of the most obvious is housing prices, around 90+% of the commercial bank loan is on housing & property. thats why house is so expensive, too much money chasing little goods. banks typically have 2 types of lending, productive and non-productive. productive lending includes actual investment in business or factory that produce goods. non-productive lending includes housing loan & speculating in financial market, which do not increase how much stuff or goods in the economy instead make houses more expensive. suppose you are a bank, why you prefer to lend on property instead of business or factory that produces goods? because business is intangible and if goes bankrupt bank cannot get anything, while if on property loan, banks could still get hold of something if debtors do not make his/her monthly loan payment to bank. thus, only about 8% of commercial bank loan is on business/factory.
indirectly when there is very little business can survive in the economy due to lacks of fund/loans. it affects how many jobs available in the economy. since we allow banks create all our money, this indirectly our money has become debt because banks only give loans. and when you have loans it comes with repayment + interest rate. thus, over the time, money supply will shrinks & we all goes into economy recession. this is what a "privatized money" do, a complete "privatized economy" under the hand of few bankers. when economy is privatized, it happens to control some part of your life too. when recession happens, it affects the government revenue too. how many police or hospital/schools/road maintainence/etc.. can be build, oil subsidy, unemployment benefit, business less profit same as less tax, etc.. thus government also goes into debt by borrowing even more and this is what a national debt is.
reference :
http://www.youtube.com/watch?v=JBZWw1DG8zU&feature=player_embedded
http://www.youtube.com/watch?v=hdvMLXc6s5o&feature=player_embedded
