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Below is the text of the two sides of the A5 leaflet I wrote and printed for distribution at anti-cuts meetings and demos. I have had many distributed locally, and I distributed about 800 in London on the TUC demo of 26 March.

– BL

Why are we Drowning in Debt?

The UK now has one of the highest levels of personal debt in the world – in April 2010 the British people owed over £1,460bn in private debt.

Recent events have woken the public to the extent of the vast wealth acquired by a handful of trillionairs, and the huge bonuses awarded to the CEOs of the failing mega-banks; but no attention has been drawn to the basic source of these facts: that the banks are debt factories!

The myth is that banks lend out the money deposited with them. The fact is that they create the money they lend, as they lend it.  This is the ‘fractional reserve system’ they operate – a legal licence to counterfeit our money supply. Prominent economists and others have been arguing for the urgent need to reform this system for over a century, and between the two World Wars  a movement for this was rapidly growing, but since then the covert grip of the banks and the super-rich has grown increasingly firm on governments, the public media and the education system, to prevent this and to maintain the myth.

The internet has opened up the means to spread knowledge, on many fronts, that the ‘powers that be’ would rather keep hidden. This is leading to widening public knowledge of the need to reform the way money enters circulation; it does not have to be lent into circulation; governments can create and spend it, debt-free.

MERVYN KING, Governor of the Bank of England, recently suggested that “some form of functional separation…to divorce the payment system from risky lending activity – that is to prevent fractional reserve banking (for example, as proposed by Fisher, 1936, Friedman, 1960, Tobin, 1987 and more recently by Kay, 2009) [should be considered]”. He ended: "Of all the many ways of organising banking, the worst is the one we have today.”

Please study the facts and spread the demand for urgent reform; a good place to start is:
Positive Money, a UK-wide campaign to reform the financial system: “We have one request – that the power to create money be taken away from profit-making entities (the high street banks), and returned to the state. Doing so would allow us to:
 – phase out the national debt, saving £100 million per day in interest costs
 - reduce the tax burden by up to 30%, permanently, or increase government services with no increase in taxation
 – save 60% on the cost of public infrastructure projects (such as schools, hospitals and public transport), by removing the need to borrow this money and pay interest over 30 years
 – significantly reduce the risk of future financial crises
 – significantly improve the stability of the banking sector, protecting depositors and the taxpayer
 – create a more stable currency and consequently a more stable economy.”

(See overleaf)………………   ……………– Brian Leslie   October 2010, updated March 2011

The World in Debt – to Whom?

We are rarely, if ever, told who all this debt is owed to.

Since virtually all our money, worldwide, is created by the private banks, and lent into circulation, the interest on this vast sum goes to create their vast profits. Much of their pay-outs in top salaries and bonuses goes, along with much other private wealth, into speculation on foreign exchange, the stock exchange and financial ‘derivatives' – all forms of gambling, extracting wealth from the producers of it. The Bank of International Settlements estimates the global total for derivatives at $1.1 Octillion ... nearly twenty times the product of the planet.

On 19 October, the Taxpayers’ Alliance reported that “at the end of 2009-2010 the real national debt stood at £7.9 trillion - that's over £300,000 for every single household in Britain, and what's more, during the last decade debt has more than tripled, soaring from 230 per cent of GDP (£2.3 trillion) up to 560 per cent of GDP (£7.9 trillion).

As Molly Scot Cato wrote on 22 October, in http://gaianeconomics.blogspot.com, about our ‘National Debt’:
“The figures, from the website of the government Debt Management Office, indicate that much of the money we are paying on our national debt borrowings is not going to foreign governments, as George Osborne gave as a justification for the need to urgently cut the size of the debt, but rather to our own good selves in various guises. So the cuts programme is really an example of robbing Peter to pay Paul. The data shown in the graphic indicate that only 29 per cent of the gilts currently in circulation are held by overseas investors, with slightly more (30%) being held by UK insurance companies and pension funds. The figures also indicate that nearly a quarter of our own national debt currently belongs to the Bank of England, which I assume is the result of the quantitative easing policy”.

–  See  www.positivemoney.org.uk, and its linked draft ‘Bank of England Bill’ – at www.bankofenglandact.co.uk/act.

Or take a look at my own ‘vidcast’, www.MoneyMyths .com

This gives links to other worthwhile sites, such as www.moneyasdebt.net or www.themoneymasters.com – or www.SustEcWeb.co.uk

 

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"If the American people ever allow the banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers occupied. The issuing power of money should be taken from the banks and restored to Congress and the people to whom it belongs. I sincerely believe the banking institutions having the issuing power of money are more dangerous to liberty than standing armies."

Thomas Jefferson – third President of the United States (1801–1809)

as is now happening, worldwide!  (BL)

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