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Sep
20

US Government shutdown and internnational action

Post By gaia1 in American Monetary Matters

 Hardly anyone in the US points to the adverse international impacts of the looming government’s shutdown on account of crazy demands on budget and debt ceiling by Republicans. IMF’s Christine LaGarde points to the uncertainty these US financial actions cause to business, governments and civil society the world over. However, she does not mention any action that the international community should consider taking.

I for one and I am not the only one that favors the replacement of the U.S. dollar with Special Drawing Rights (SDRs) which were first proposed in the middle seventies after the Nixon Administration had  closed the dollar/gold exchange window. Civil society and perhaps business should start agitating and pressuring their countries’ financial authorities to have the IMF change its articles so that the US with its 18% voting rights is unable to block the decoupling of the U.S. dollar from being the international exchange currency. Once this process is underway, I for one and not many others yet, believe that we can use this reformed international monetary system to make a final transformational change by basing it on a carbon standard. This transformational change is needed because we are headed towards a climate catastrophe and we need drastic changes in global climate policies if we do not want to imperil people, species and planet.

 

Sep
16

The transformational challenge of the new US Fed chairperson

Post By gaia1 in American Monetary Matters

This comment was submitted to the NY Times on September 16 when Dr. Summers withdraw his probable nomination by the Obama Administration.

Given that the US Fed in the absence of global central bank is the nearest to a global central bank its new chairperson has the obligation to not only deal with monetary matters at home but also play a leading role in making the unjust, unsustainable and, therefore, unstable international monetary system less unjust, unsustainable and unstable. Optimally this would mean that s/he consider transforming the role of the dollar by not having it play the role of an international currency.

As proposed during the middle seventies and emphasized by the UN Stiglitz commission after the financial collapse in 2009 moving into SDR (Special Drawing Rights) realm would be to the benefit of the US and global economy.

A really transformational international monetary policy for the new US Fed chairperson would be the basing of the international monetary system on the carbon standard of a specific tonnage of CO2e per person. In that way the international monetary system would become stable, just and sustainable. Should the various monetary unions in the USA, South America, Europe, Africa and Asia not begin to discuss the feasibility of a global central bank with its appropriate administrative, regulatory and monetary functions? The conceptual, institutional and strategic dimensions of such carbon-based international monetary system are presented in a recently published book entitled The Tierra Solution: Resolving the Climate Crisis through Monetary Transformation.

 

Sep
13

The carbon monetary standard in an anchorless world

Post By gaia1 in TFD system

 The carbon monetary standard for an anchorless world.

 

On September 12, 2013 NYTimes Op-ED columnist Roger Cohen presented his views of “An Anchorless World” focusing on the unsteady hand of the Obama Administration during the Syria Crisis. He goes back to 1945 when the US was the steady hand after WW II and set up a world order around the U.S. dollar and the US economy. Having noted the steady decline of the world order, he, a German friend and John Kornblum, the former U.S. ambassador to Germany commiserate together about the anchorless world without a vision of an alternative world order. I submitted the following comments (probably #199):

 

From an anchorless world to a world with a monetary carbon anchor is a huge challenge that humanity has to discuss if we want to avoid a climate catastrophe. We need an integrated vision that would deal with the climate, economic, political and monetary challenges simultaneously. We need such vision, because dealing with one or two major issues separately and disjointedly often creates other, unforeseen, problems.

By discussing and developing the challenge of carbon-based international monetary system we are dealing simultaneously with the climate crisis and the unsustainable patterns of economic, financial and commercial global systems. Changing, i.e. transforming the international monetary system which acts glue of those systems, changes and transforms the monetary, financial, economic and commercial systems. Details of this carbon-based international monetary system, which is the necessary but not sufficient condition in removing the present anchorless world, can be found in the recently published Tierra Solution proposal which presents the conceptual, institutional and strategic dimensions of such new world order.