Money Reform Motion rejected

16 Jul 2010

The motion which ALTER had supported (although it was not our idea) on radical reform of the way that money is created "from thin air" by banks has not been accepted by the Party's Federal Conference Committee (FCC).

In explaining their reasons for rejecting the motion, FCC's spokesman said:

"The motion is a variant on several others that you have previously submitted. You will not be surprised to discover that the Treasury team remain opposed to the principle of 'printing money'. However Conference Committee does not allow our Parliamentary teams to veto policy proposals and you will recall that a couple of years ago we did allow an amendment on this topic to be debated. That proposal was defeated and there is a reluctance to revisit this debate now.

"There will come a time when we would reconsider a motion on this topic, but not yet. There was a feeling that a conceptually dificult proposition was made more confusing by the inclusion of options in the 'Conference calls for' section and it seems particulary perverse to advocate a tax on bank lending at a time when the reluctance of banks to lend is a major issue for the nation's economy."

ALTER would like to know the views of its members and other Lib Dems. you can download the motion below. You can also read a more thorough explanation of the thinking behind it if you got to the Bank of England (Reform) Act website - link below. A short explanation was produced by ALTER member Bill Powell: "Banking and Seigniorage", which is also available below.

Since most loans are 'secured' against the value of property, there is clearly a link between land values and money. Buildings depreciate; it is land that 'grows' (in value) - although fixed in supply.

Should ALTER be looking at this wider issue, as other radical reformers are? Or should we stick to 'simple' Land Value Tax, as Vince Cable advises. We think the links between Money & Land are inescapable and fundamental to any modern, sustainable economic model.

Comments should be sent to bill[at] and/or aduffield1[at]

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