The Privatisation of National Credit and Money-Printing by Jeremy Lee (Australia 2000- How Bright The Vision?)

This expansion of the money supply occurs every year; a smaller increase during a credit squeeze, accelerating when the Reserve Bank believes the economy needs stimulating. The controlling mechanism is now largely confined to the raising or lowering of interest rates.

It can also be seen that the creation of Australia’s monetary requirements - which many believe should be a Government prerogative - has been ceded almost entirely into private-sector hands. New money is put into circulation through loans and overdrafts, on which the ‘creators’ earn interest, and charge fees for operating accounts. They are not lending their own capital. They are claiming ownership of “new” money which is practically costless, and which should, in a just system, belong to the community.

It needs little acumen to grasp the power and profit which goes with such a system. It is literally, rather than metaphorically, a “licence to print money”. It also places both profit and power, far beyond a normal return for services rendered, into a few private hands. It is the literal power to make or break a society.

And it is a power which is jealously guarded.

Something of the hypocrisy surrounding debate on this issue was seen when One Nation representatives suggested the establishment of a bank to provide $150 million for farmers and small businesses at low rates of interest during the 1998 federal election. The response from the Prime Minister and the Treasurer was that using “printing-press” money would be highly inflationary and jeopardise peoples’ savings...

The sum suggested by One Nation was just over half-of-one-percent of the “money-printing” - a term now used to describe not just the production of notes and coin, but ANY increase in the money supply - carried out under Government policies between December 1997 and ‘98!

As far as I am aware only one major paper picked up the irony. Economist Kenneth Davidson, writing in The Age, said:

Ridicule was heaped on the One Nation director David Ettridge who had the temerity to advocate the setting up of a ‘peoples’ bank’ with $150 million of printed money to finance low-interest loans for small business  The ALP forgets about the history of the Commonwealth Bank ... On the 7.30 Report last week Costello left the impression that printing money was anti-Semitic as well as economically unsound. “No country in the world does that. If a government started printing notes and passing them into circulation inflation would take off in this country and destroy peoples’ savings”. This sent me scrambling for the latest Reserve Bank monthly statistics which show that in the year to April, the Reserve Bank under the direction of the Treasury printed or coined some $1.5 billion in new currency ....”

In fact, during 1997 total new money created - of which notes and coin were only a small part - was $31 billion.

In the first 80 years following Federation private Trading banks, even though they had ‘annexed’ the power of money-creation with the explicit compliance of government, were nevertheless Australian in ownership and sentiment.

With the deregulation of banking under then-Treasurer Paul Keating (supported in principle by former Treasurer John Howard) two things happened. A number of overseas banks were allowed to set up in Australia for the first time, and the major Australian Trading Banks adopted ’globalism’ as their modus operandi and took in foreign equity, becoming in the truest sense international banks.

With the world as their oyster, the drastic closure of Australian industry, the entry of multinationals with huge deals in the takeover-and-merger business, Australia’s banks entered a bonanza which burgeoned through the late eighties and the nineties. Operating what was no more, in essence, than a national accounting mechanism in which they ‘swapped’ figures from one account to another through their Clearing House, they set their own fees for their services, moved together into increasingly-sophisticated technology which allowed them to sack tens of thousands of staff-members, and contemplated ways of eliminating the cash component of their operations altogether. The ‘Cashless Society”, if not quite on the doorstep, was clearly visible on the horizon.

Australia 2000- How Bright The Vision? available from
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SA 5159
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Thursday, 20 June 2024

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