What is the incentive structure and how does it penalize gamesmanship? How is the group ruled and why can't 51% of it say that we want to create all of the money for ourselves?
Aren't people already paid for using their money as loans in the form of interest rates and being able to structure how and when the money can be withdrawn (money market vs. savings, etc.)? What advantages are there to this? How do you get banks to offer that and what does the average guy like me even know about trying to control the money supply?
And even in that case, don't you still run contrary to the goal in that those with larger amounts of money still manipulate the money supply by choosing investments?
The group may be appointed in a number of different ways, though I suspect it'd be mostly down to standard job hiring, with some key positions appointed by government. If it helps, I imagine it'd be similar process to how judges are appointed.
However, it's important that the money creation group not be part of government. Furthermore, they do not dictate the flow of money, but rather the amount of new money. Any attempt for a non-elected body to control how money is spent opens up a whole host of potential problems. Instead, it is the government that would decide how new money would flow into the economy, i.e. what that new money was spent on.
In terms of gaming the system, there's always a risk of gaming any system, but it's important to be clear that the decisions on how much new money is available and how that money is spent are being made by two different groups of people. Let's put it like this, if you wanted to game this particular system, how would you do it?
Isn't that more or less how we get the membership of the US Federal Reserve? https://en.wikipedia.org/wiki/Federal_Reserve_System
Also, it's not clear what "not being part of the government" means if some positions are politically appointed. I suppose you're saying new ones can be appointed but old ones cannot be removed, but then that either makes it a lifelong post (which sounds worrisome as they'd be a prime target of corruption) or someone else decides their removal (based on what?).
> Any attempt for a non-elected body to control how money is spent opens up a whole host of potential problems. Instead, it is the government that would decide how new money would flow into the economy, i.e. what that new money was spent on.
I'm having trouble understanding this because the sentences appear to contradict each other in part.
> Let's put it like this, if you wanted to game this particular system, how would you do it?
I'd have to understand it better, first. But in general, a corrupt person would divert the supply of money to flow to them or people who would give them kickbacks (buy their stuff, hire their friends, etc.). They'd divert money away from whatever groups they did not like (political, religious/atheist, minorities, you name it). They'd use control of supply to direct flow to favored media outlets and away from those critical of them. I'm sure there are plenty more evil things to do that I haven't thought of, as well.
Are judges in the US legal system part of the US government?
[1] http://www.archives.gov/exhibits/charters/constitution_trans...
Let's look at this in more detail, as it's clear I haven't explained the plan well enough yet.
First, I should clarify the Positive Money campaign I linked to is about money reform in the UK banking sector, but the general ideas can apply equally to the US, even if the implementation details would be different.
Okay, so let's look at the situation in the US. Money in the US is generated in two different ways:
1. Federal Reserve generates money for the US government to spend through the sale of government bonds.
2. Banking system generates money through making loans.
I'm going to leave the problems with the current systems for the time being, so let's skip to what we would change if we wanted to have a single central body in charge of new money.
Firstly, you would take the power to create money away from the banks. Banks could only lend money they had available to lend. This could work through lending out the savings of other bank customers, with customers able to choose how much or little of their money they wanted to invest, and what risk/reward ratio they wanted to have with their investments.
Secondly, you would want to change how money reached into the economy. If banks couldn't create new money, who can? Should government take on this role? The risk with giving governments this power is they might end up printing more money than is needed in order to fund extravagant government projects. How do you get around this?
If the Positive Money ideas were applied in the US, you wouldn't have the Fed selling bonds. In some sense the Fed wouldn't exist. What you'd have instead is one central, transparently-run group controlling how much new money was created, which sets the budget for the government to spend. All new money would be spent into the economy through government programs. There would be no need to sell bonds, the money would be created without debt (i.e. without the need to pay interest to groups willing to buy government bonds), it would simply be new units of exchange available for use in the economy.
Any questions on the above?