THE IMF GLOBAL CURRENCY AND THE IIMT GLOBAL CURRENCY
The April 13, 2010 discussion paper—mostly for in-house consumption?—shows how the IMF is angling to elevate its SDRs into a global currency that would be administered by an expanded IMF.
Since John Stuart Mill proposed a global currency in the 19th century many others, well-known and not so well-known observers, have made proposals for a global currency with more or less details on a world central bank. Of course, libertarians and their institutes such as the Von Mises Institute are ideologically opposed to such global monetary system. Like in most of these controversies the perception of the role of government is often a or the crucial factor in determining the differences.
The IMF and those earlier promoters are right in pointing to the need of an international monetary authority to accomplish an equitable and sustainable, and therefore, stable international monetary system.
The International Institute for Monetary Transformation www.timun.net agrees with that need, but disagrees with the IMF’s approach. The Institute proposes carbon-based monetary standard which would transform the international monetary system’s exchange rates, its national currencies and its costly global reserve system. It would remove the global reserve system because national currencies would become convertible because they would be based upon the Tierra, the new monetary system’s unit of account or numeraire. Once nations decide to make to adopt a global currency the Tierra becomes also a store of value and means of exchange.
The reason that this transformed international monetary system is based upon a carbon standard is humanity’s predicament of climate change, its greatest challenge in the 21st century. By making the international monetary system’s standard a carbon standard this important and underestimated international system becomes a systemic support in avoiding dangerous levels of global heating. This transformed international monetary system uses the fee and dividend carbon reduction method rather than the cap and trade method which is considered not to be fast, formidable and fair enough. Thus, the new system is known as the Tierra Fee and Dividend system. It will be presented in book form by Cosimo Publishing at the end of this year. It will be presented at the UNITAR/Yale University conference of 17-19 September as part as their global environmental governance program.
Part of this IIMT’s transformed international monetary system is the introduction of carbon accounts in a nation’s balance of payments. Like its financial imbalances, a nation has to balance its ecological imbalances of being carbon debtors and carbon creditors.
Finally, the IIMT’s carbon-based global currency of the Tierra and its earlier carbon-based national currencies are administered by a decentralized UN World Central Bank that is part of an emerging global political entity.