Topic: Ron Paul
Why Ron Paul Failed to Captivate the WHOLE Country The fatal defect in the first skirmish for vital monetary reform.by mike montagne (PFMPE)
(Libertarian)
Wednesday, February 6, 2008
Rare is the candidate who doesn't exalt the ghost of greatness we once were, as if mountains of perpetually multiplying, insoluble debt, tens of millions of families losing their homes, our vanished industry and overwhelming trade deficits, and our fallen stature as an intellectual power and bedrock of liberty and justice... are not a testament to the opposite.
Ron Paul won on many tangible fronts, because he showed America that even as an unassented central bank's media sought to deny our quest for vital monetary reform, there is a chance to save America from itself. He denied himself and his supporters the ultimate prize, because of a technical deficiency. A quite serious one.
Most of the country will continue to fail to realize that they have cast their country to the wind, for even worse is the technical deficiency of the remaining and future presidential field. In the wake of Ron Paul, all we hear is "change."
"Change" is an obtuse appeal that surfaces every 4 years (or every 2). In response to what was perceived as an economic downturn, but has since been portrayed as promise, Richard Nixon promised "change." Jimmy Carter promised "change." Ronald Reagan promised "change." Bill Clinton even falsely claimed to have achieved it under a false boom's temporary infusions of unwarranted capital, while private debt continued to multiply to the consequences now before us.
*Principle* is the key to effective change; and yet every president in the last 100 years merely left the unassented process intact which could only multiply debt upon us until our industry disappeared, trade deficits mounted, our government succumbed to intellectual and monetary bankruptcy, and the many social programs which exist only for the faults of that government to solve proper economy, could only fail. Today is the long coming culmination of that negligence -- a negligence Ron Paul did at least succeed in drawing momentous attention to.
Our country was founded on incontrovertible principles, and causes which never die. We will rise from today's skirmish. But we will succeed in righting our country only when we unite upon real solution.
This is the technical deficiency for which the Paul campaign failed to unite the whole country, even as the hollow calls for change by the mainstream candidates too will leave the fundamental cause of our near term failure intact.
The wounds of the present skirmish could be foreseen. Today's loss could be foreseen, because, as the founders expressed in so many ways -- especially when they cannot be presented a clear vision of solution -- people are inclined to suffer, while evils are sufferable.
And so we reach the end of that rope, the near limits of what we can suffer, still knowing that the only potent weapon in the war against usurpation is solution.
The American people wanted to hear solution. But did they hear one?
If we were to design a bridge, any qualified engineer would recognize that if the people were to ultimately decide the integrity of the engineering, the process of properly engineering a bridge would have to be qualified. We cannot shout "sound money," never defining in the very terms of a proof of a theorem, what sound money would have to be.
Neither can we certify that our bridge will deliver its intended service, without qualifying what forces act upon it, and how we must account for those forces if our bridge is to succeed.
We never had this fundamental discussion. Instead, we heard loose allegations which could never be overwhelmingly convincing, because of the lack of substance.
Suppose then that we have a bridge, and suppose further that we can show how the plan of the bridge is a defective one.
Why will our bridge break when subjected to the duty levels we intended it to support?
To answer this question in terms which are always obligatory to solution, we must put our finger on its defects. We must point out exactly what is wrong with the bridge, that proper engineering can account for its demonstrated defects. It is not enough to say that the previous purported engineering was just "created out of thin air."
It happens not only that I have worked to point out the deficiencies of the bridge for 35 years; it happens that I have advocated a mathematic proof of singular solution. Every president since and including Gerald Ford has been presented this mathematic proof of singular solution. But I was most surprised how reluctant Ron Paul's campaign was to respond to it.
I was first told in fact, that there is no such thing as mathematically perfected economy™. I immediately asked, "Do you mean to tell me that you believe you can demonstrate that if inflation and deflation are defined respectively as increases or decreases in circulation per goods and services, there is no solution to inflation and deflation?"
They then refused to debate their assertion.
But even if a party is wrongly dedicated to the proposition that there is no such thing as mathematic solution of "economy," the blatant question is, "What then do you advocate, if you assert no solution can be qualified?"
The question of course is both preposterous and moot, because obviously, if we define inflation and deflation respectively as increases or decreases in circulation per goods and services, then we solve both inflation and deflation if and only if at all times we maintain a circulation which is equal to the remaining value of goods and services.
The only real questions are, "why did we ever design a bridge not to do that?" "Why would the Ron Paul camp reject the proposition that we can design a bridge to do that?" And particularly, the question for which Ron Paul failed to captivate the whole country is, "What qualifiable basis can you possibly propose, if you reject the very principle of mathematic solution?"
Worse than a dead end, the road can only lead to failure.
Let us consider principle; and to get at the crux of the matter, let us consider how we need to design a bridge.
Our issue is really a simple one. Are we served by a currency which is strictly a medium of exchange? Or are we served by a currency subject to other processes?
Obviously, if we are to answer this question, we must evaluate the ramifications of whatever other processes we are to subject the currency to.
If a currency is only a medium of exchange, it is empowered with no detrimental effect, because no process is attached to it. But if any process is integral to the currency, we must ascertain the ramifications of the process to determine if it is adverse to the purposes a people would intend of their monetary system.
In other words, if a process attached to the currency diminishes the value of the currency, obviously this is adverse to many natural purposes of a monetary system. If the process makes our production ever more expensive to us, we will work ever more for our very own production. Instead of paying for a home with an equal measure of work as produced it, we may pay lifetime after lifetime for the home. The value or cost of the currency or property are intrinsically (systematically) manipulated to our ever greater detriment, if our intention and capability both are to pay for our production with an equal measure of production.
If a process attached to the currency inherently and irreversibly multiplies debt upon us until we collapse under the weight of an eventual insoluble debt, then obviously, this is hardly a purpose a representative government would pursue on behalf of its people.
To say that we cannot identify and solve such problems is only a testament then that we are adverse to the elementary mathematic skills necessary to do so.
How might a purported "economic" system adversely multiply debt upon its people? How might it be impossible to reverse the multiplication of debt into insoluble debt?
It happens that the founders were after the answers to these simple questions, even if they did not quite arrive upon mathematically perfected economy™. Jefferson and Lincoln all but arrive at solution. Jefferson left us diverse warnings that the present system -- a privatized currency intended to take unearned profit -- is the very greatest kind of danger to us because its efforts would have to usurp representation. He foretold that solution of the present problems remained as the most urgent and necessary work for future Americans. But let's understand the problem, that we can understand and unite upon solution.
In any purported economy where the currency is subject to interest, it is mathematically impossible/impractical to maintain the circulation without suffering perpetual multiplication of debt.
Merely to maintain a vital circulation, we must re-borrow what we pay against principal and interest obligations, as subsequent debts, increased so much as periodic interest. It is impossible to maintain the circulation and pay the sum of debt down, because re-borrowing whatever we pay against principal obligations perpetually comprises new debt, equal to former debt.
But whatever we pay against interest counts none against the former debt; and therefore, because we must re-borrow this too to maintain a circulation, we are constantly forced to take on new debt, with the sum of debt thus increasing so much as periodic interest on the sum of all debt.
Thus the sum of debt grows by ever greater sums of periodic interest on an ever greater sum of debt, until at an ever escalating rate, the subject commerce can no longer meet the imposed costs of servicing the artificial sums of debt. Every such system therefore ultimately and inevitably terminates itself under insoluble debt.
The concerns of the present are real. They are crucial. But our complaints too are hardly more than "thin air," unless they are the impetus to unity over true solution -- a plan for a vital bridge which can serve its purposes. There is no compromise on the matter of real solution. As this simple process demonstrates, true economy can never exist if it is subject to compromise or adulteration.
All along the way, this manipulation of the value or cost of money or property works against us to an ever greater degree. The process is irreversible if we merely maintain a circulation. If we fail to maintain a circulation, we suffer failure imposed by the impossibility of meeting the obligations of artificial sums of debt: we can neither pay off or service debts far exceeding the circulation with the remaining circulation, un-replenished by further borrowing. If we maintain a circulation, we fail under the impossible weight of eventual sums of debt. Ultimately, in any possible case, the consequence of this process is terminal.
Not only did Ron Paul never address the ramifications of interest; he therefore evaded the very issues which are vital to solution. A gold standard or reduced taxes will not arrest further multiplication of debt. Nor will further privatized currencies, "competing" in terms of the very process which, so long as it exists, can only further multiply debt.
This was the fatal error of the first skirmish; and perhaps it was my failure, because I failed to gain the ear of the Paul Camp.
But we can solve these problems, and we must solve these problems; and the battle is hardly begun. We cannot blame the people if we fail to deliver solution. We cannot blame others, if we fail to unite upon solution.
We can establish mathematically perfected economy™ immediately. How? And what is mathematically perfected economy™?
Mathematically perfected economy™ is the singular integral solution for inflation, deflation, intrinsic (systemic) manipulation of the value or cost of money or property, and inherent, irreversible multiplication of debt in proportion to a circulation.
In other words, it is the singular prescription by which we maintain a circulation which 1) at all times is equal to the current/remaining value of related assets; and which 2) does not multiply debt in proportion to a circulation. By this combination of properties (1 + 2), 3) it eliminates intrinsic (system-engendered) manipulation of the cost or value of money or property.
How does mathematically perfected economy™ work?
In the case of a $100,000 home with a 100-year lifespan, we pay for the home at the overall rate of $1,000 per year or $83 per month. There is no interest (which multiplies debt into collapse under insoluble debt), because as the people might issue their own promises to pay to each other without extrinsic cost (unassented, unearned profit by exterior parties who contribute nothing to the transaction), they issue secured evidences of debt without extrinsic, ever-multiplying cost, through truly representative government.
The question is, whether the people should issue their own medium of exchange; or must we (without our consent even) subject the currency to privatization for the sake of the illimitable, ever more damaging unearned profit of a few, when in fact the currency is created at no real cost whatever ("out of thin air," as so many are saying)?
The consequences of the latter, and the solution to our demise, both stand naked before you.
How do we establish mathematically perfected economy™?
We simply 1) re-finance all debt without interest and subject to a schedule of payment equal to the rate of depreciation or consumption of the related asset; and 2) restore to the people what they would have retained under mathematically perfected economy™, had they not been denied their production by involuntary servitude.
Well, just for instance... the proposition should leave little doubt how mathematically perfected economy™ would immediately and permanently resolve the so called sub-prime mortgage crisis. While mathematically perfected economy™ is the only sustainable prescription for economy, the sub-prime mortgage crisis is but a symptom, an artifact, of the present world's central banking systems -- a process running rampant across the world.
The purposes of the present system are plain as the facades of the many hollow pundits given free license to exalt its taking from us.
We live or we die by solution. There is one bridge which will take the people where the people intend to go. Leaders who will prevail in our cause will give them that bridge.
Unite on solution, or give further license for "change" to perpetuate the status quo, and the consequences of further multiplication of debt for unassented and unearned profit even the pundits will soon succumb to.
As Ronald Reagan debated Jimmy Carter in that famous exchange where he turned to Carter and pronounced the $150 B of federal debt accumulated under the Carter Administration as "unforgivable," I had written the Reagan staff, providing a set of mathematic proofs 1) that unless he established mathematically perfected economy™, he would see private and public debt multiply by even greater increments of periodic interest, and that 2) his proposed 3 years of 10%/yr federal tax cuts were incapable even of offsetting what he called "inflation," much less solving its one systemic cause -- irreversible multiplication of debt.
In due time, I provided the Reagan Administration with computer models which accurately projected the tripling of debt his administration suffered, and which calculated the maximum possible lifespan of any "economy" subject to "interest." For almost 30 years, the accurate projections of those models (which are still available) have been dismissed without debate. In the first seven years, for the sake of that negligence, the United States descended from the "greatest creditor" nation in the world, to its lowliest debtor.
Ron Paul wouldn't have that debate. He condemned mathematically perfected economy™ to the same place the central bank's media reserved for his campaign. I say he squandered for the while our greatest opportunity to succeed.
I hope Ron Paul and the American People will reconsider.
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2008 mike montagne (PFMPE), all rights reserved.
Published: Wednesday, February 6, 2008
Last modified: Wednesday, February 6, 2008
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Ron Paul hasn't lost yet don't give up hope. Go door to door and tell everyone to write in his name when they vote. Ron Paul is the only candidate that can take on Hillary or Obama and win!
Ron Paul can still win this thing, we just need to quit being so negative. People like you are ruining Ron Paul's immage. Ron Paul is the only hope for America.
I liked your article, but I definitely have reservations about your perfectly matched economy. If you have read Naomi Klein's Shock Doctrine I would be curious to hear your opinion about how it relates to what you are arguing. I am educated as a political scientist, so I always see economics through a social lense. It is difficult for me to classify economics as a hard science like mathematics or physics, and the idea of a perfectly matched economy is problematic to me.
P.s. I really enjoyed your writing style, very captivating
I think you missed one MAJOR point in your discussion/advertisement. Ron Paul is not only calling for a switch to the gold/silver/etc. standard, but also for the eventual removal of the privately-owned Federal Reserve from our monetary system. It is the Federal Reserve systematically manipulating our economy, especially in combination with the disgusting practice of fractional-reserve banking, which is killing our economy. Banning fractional-reserve banking in our country is the first necessary step towards eliminating our national debt. Second is removal of the Federal Reserve and the debt-based money we receive from it. The utopian idea of lending money without interest is a bit far reaching. Allowing banks to lend amounts equal to their deposits, at a slightly higher interest rate is quite reasonable for business costs. Lending out 10 times the amount in deposits, while paying a fraction of the interest rate (on one of the loans) to the depositor, is simply fraud.
Dr. Paul may not come right out and say it (who could blame him), but allowing competing currencies in our country will eventually destroy the Federal Reserve and return our nation to a profitable economy.
Have a bit more faith in Ron Paul's abilities as an economist.
Posted By: mike montagne
Date: 2008-02-06 15:28:54
If you're asserting that the gold standard can avert further irreversible multiplication of debt, or that any proposition offered by Dr. Paul can avert further irreversible multiplication of debt, I certainly invite you to debate or demonstrate how:
We should have that debate if you really want your candidate and our revolution to succeed; and we should have it right away because there is hardly a moment to spare.
To be clear, I have supported Dr. Paul, and I have months of time invested in the hope of the success of this movement. If you believe we can succeed without a plan, tell us how. If you can refute/disprove the present proposition, do us the service of disproving it, because even Ron's staunchest supporters have been left wondering, "Where's the meat?" Can you knock on a door and tell the person there how Ron Paul will avert further multiplication of debt, and failure?
A part of this revolution is the idea that the era of politicians *without* plans should be banished forever. As I wrote, it's incumbent upon us to make sure that we have one which will succeed, if we are to succeed. Disprove the proposition, and I'll gladly unpublish the article. Otherwise, I wonder why instead you would not ask Ron to evaluate mathematically perfected economy more seriously. What's the downside then?
Just something to think about, as debt continues to multiply everywhere about us.
Posted By: mike montagne
Date: 2008-02-06 15:39:09
Eric,
I wish what you were saying were still true. But if you have studied Ron's recent release of his "Comprehensive Economic Revitalization Plan," you will note that instead of termination of the Federal Reserve System (which I irreversibly support as well), he is advocating televising Federal Open Market meetings -- further *transparency*.
Still, if we rescind the so called Federal Reserve System, we must replace it with something that works as we need a monetary system to work. We haven't even had the discussion about those fundamentals. A gold standard will not avert multiplication of debt if currency is still subject to interest. Neither will it sustain commerce requiring a circulation greater than finite monetary reserves.
So where's the meat? What answers do we have for these basic questions?
If we don't have those answers, how are we to have any bona fide faith in a further proposition?
I'm saying this failure is why we don't have a greater core of support than we do.
Posted By: mike montagne
Date: 2008-02-06 15:50:27
rk,
Conventional economics is not a hard science at all. As far as I'm aware, it's wholly bereft of formal proof and theorem.
What I'm saying however is that ther is a science -- that we can solve inflation, deflation, intrinsic manipulation of the cost or value of money or property, and inherent, irreversible multiplication of debt.
Others may wish there were more to economics, which largely are distorted to create opportunities for unearned taking.
The mathematics are elementary. No worthy mathematician will contest the proposition of a singular solution to inflation and deflation, for the problem is simple and its answer is clear. Neither is there a reasonable argument that eliminating interest eliminates multiplication of debt in proportion to the circulation.
Finally, the combination of these solves systemic manipulation of the value or cost of money or property.
Give that a little time, and I believe it will register with you.
Thanks for the kind words about style.
And for all of us again, let me be clear: My original proposition to the Paul camp was that mathematically perfected economy could put him in the White House. I still believe that wholeheartedly.
After all, there aren't two solutions for inflation and deflation; neither are there 2 solutions for inherent, irreversible multiplication of debt.
I think therefore that the most negative consequences are promoted by further rejection of mathematically perfected economy -- and particularly, because anything else fails to solve the critical issues at hand.
Posted By: Sean Michaels
Date: 2008-02-06 16:09:04
Is there any country using this mathematically perfected economy™? Has this system been proven sound through use? Many things look good on paper, but do not succeed when implemented in reality, like communism. Communism looks and sounds great in theory, but could never work for the benefit of all parties involved. Just thought I would ask.
Mr. Montagne, I enjoy your writing style, but I have so many issues with your 'perfect economy' that I don't even know where to begin.
For one I believe that utility is individually subjective, mostly immeasurable, and varies for no-rational reason from moment to moment, and thus I see no way to derive a collectivist measure of utility.
From this one simple premise, I'm sorry but in spite of your oratory style, I'd honestly have to say I'd avoid any economy based on your mathematical system, like it was the plague itself. This coming from a person with formal training in control systems engineering; I'd rather live in a free market society where the maximal rate of expansion of the supply of legal tender is hard limited by physical scarcity-- no government has ever proved itself beyond the temptation to monkey disastrously with an 'official' money supply.
You see, governments want a fiat currency because otherwise taxation seems onerous. For example, if your business creates something the government has no need for, say hubcaps, then it's damn inconvenient to the government for you to pay them in hubcaps. They'd have to expend effort trading away hubcaps-- much better to foist that effort back on you, the taxpayer. However, let's say you could pay them in hubcaps-- you'd know exactly what you paid in terms of raw materials, time, effort and lost opportunities. You'd be keenly aware of this multidimensional expenditure and could rationally compare it to the services you receive in return (if any)-- but, once you collapse all those dimensions down into one gross fiat measure in an accrual accounting system, that awareness is invariably lost and that is the whole point of the exercise, to elicit a nominal profit or nominal gain, taxable for the benefit of the state.
Posted By: mike montagne
Date: 2008-02-07 14:36:36
Dear Mr. Kimble,
You appear to draw up the things which you purport to oppose from somewhere else.
MPE is a free market;whereas obviously, the present imposed, unassented system which MPE purports to rectify is certainly not free, particularly in the cited aspect that the imposed, unassented system inherently and irreversibly multiplies debt in proportion to the circulation, until all commerce fails.
As to why anyone would desire not to solve such a costly and destructive process, you do not say. But I certainly don't see 14 million families giving their blessing to the system which is now stealing their homes from them. I don't see the American People giving that system their blessing for the federal debt that has been multiplied upon them, which they can never and should never have to pay. I don't see all the marginalized businesses which are faced with failure giving their blessing to the system which devotes so much of the circulation to servicing debt, that for all their worthy skills and effort, they cannot survive.
But we certainly don't hear them thinking either, that they should suffer these unassented, imposed consequences, because "utility is individually subjective, mostly immeasurable, and varies for no-rational reason from moment to moment." Is that why people are happy that in a nation which not long ago was among the most prosperous in the world, and now is the lowliest debtor nation in history, they can no longer afford health care?
On our death beds, after not receiving treatment for some terminal disease until we gave up our home for a tooth ache, are we saying, "Thank God Kimble saved us from a solution he couldn't even disprove?"
Yes, even after offering a completely unqualified objection to a non-existent property, neither do you disprove the propostion of MPE, that there is but one solution to irreversible multiplication of debt in proportion to the original circulation.
Do you really suppose that there is an American who should avoid paying $83/month like the plague; that they are better off paying 12+ times that for no benefit whatever?
Unless you can disprove that MPE solves inflation, deflation, intrinsic (systemic [yes, MPE explicitly avoids what you accuse if of *doing*!!!]) manipulation of the value or cost of money or property, and inherent, irreversible multiplication of debt to inevitable collapse... then what you are advocating is that we run from the one and only solution which can save us not only from paying lifetime after lifetime for our own production, but from ultimately suferring complete commercial/industrial failure, and adhere to what can only destroy us.
Pray tell, what is the sense of that?
In return I reply according to my cited statement that MPE makes no attempt whatever to derive, to develop, or to impose "a collectivist measure of utility." Where do you get this idea you then purport to argue against?
After inventing a property to argue against, neither does your ostensible argument provide any evidence whatsoever that your argument has merit, for is there really no possibility of a rational, collectivist measure of utility (even if MPE makes no attempt to impose one)?
While the point against which you argue is not even a property of MPE, you then go on to offer one reason (only) that governments want a "fiat" currrency, as if this further assertion could have any relevance whatever.You give that reason as:
"You see, governments want a fiat currency because otherwise taxation seems onerous. For example, if your business creates something the government has no need for, say hubcaps, then it's damn inconvenient to the government for you to pay them in hubcaps..."
What *possible* relevance could this have as an argument against MPE? Is what you say even true?
Do you mean that if our commerce and the same taxation were conveyed in equal units of gold, the taxation would seem less onerous [ Troublesome or oppressive; burdensome. Entailing obligations that exceed advantages.], even as the relative units *would have to be the same*?
If I have 12 units of business/production upon which I have to pay 6 units of taxation, how is it that you argue on the one hand we cannot rationally solve the faults of the persent system "because" there is no rational collectivist untility, yet here, where there has to be a collectivist concept of utility, you assert that the nature of the units of the monetary system determine the perceived proportion of oppression?
The proportion of oppression in terms of the total taxation is the same! But particularly, my question to you is, *regardless of the nature of the units* ("fiat", gold, trade, hard assets.), if ninety percent of the taxation goes to service artificially multiplied debt, how then do you account for or justify this oppression, or say it can or should be perceived differently for the sake of the nature of the currency?
If anything, what we are to perceive is that the nature of the currency multiplies these unnatural costs upon us for the sake of unearned, unassented profit of the few, not only at cost to all the real producers, but to their eventual failure.
If your points justify our suffering that failure, I cannot even imagine how. You advocate that it is wise to avoid solution like the plague.
Why? And how are we to understand there is any wisdom in that whatsoever?
Thomas Jefferson said, "If the American people ever allow the banks to issue their currency, first by inflation and then by deflation [by introducing a currency subject to interest, by having to pay interest and principal out of the circulation, and then by having to maintain the circulation by re-borrowing the principal and interest as a greater debt, increased so much as periodic interest], the banks and [eventually bank owned] corporations which will grow up around them will deprive the people of all property, until their children wake homeless on the continent their fathers [had just] conquered."
Mathematically perfected economy is not about imposing "a collectivist measure of utility," as you falsely assert. Ultimately however, in all trade, there is some measure of utility, for those who trade do decide some value of what they offer or receive.
What you fail to perceive, or what you argue falsely against, is that mathematically perfected economy imposes nothing; on the contrary, it is the singular system in which those who trade may receive the full measure of their production in the form of whatever production they trade for.
The present system denies you the opportunity to do that. It devotes ever more of the circulation to servicing perpetually multiplied, artificial sums of debt. There is no argument which justifies the quantity of taking involved there, because the quantity is interminably multiplied until all is taken.
Yet you advocate adherence to that system, despite the evidence of its demise all around you. You say that people who are losing their homes and businesses, who are denied health care,
We live in a village. A hundred years ago, a lion stole among us every few nights, to drag one of us from our grass huts. A month later, two lions came, dragging away two of us. Then four. Then eight. Then sixteen. Then thirty two.
One day, one of us devises the only effective defense available -- the only defense that can ever exist.
You admonish the village to avoid him like the plague, saying there is no way to rationally quantify any phenomena related to lions.
I'm trying to save my country Mr. Kimble. What are you trying to do?
Can you disprove mathematically perfected economy? Can you disprove that we suffer perpetual multiplication of debt in propotion to the circulation? Can you disprove that there is one and one only solution to inflation, deflation, intrinsic (systemic) manipulation of the value or cost of money or property, and inherent, irreversible multiplication of debt in proportion to the original circulation?
Can you disprove there are terminal consequences to the latter process?
Those are ominous things to assert from your recommendation to avoid mathematically perfected economy like the plague, especially as your arguments are wholly void of substance.
Thank you for taking the time to demolish my sleep-deprived heat of the moment ramblings-- I have problems with people using words like 'perfected' and 'mathematical' together with anything related to economics. I certainly need to reread your article, reread my diatribe, and read your rebuttal carefully and fully in order to provide a deserved reasoned response.
Posted By: mike montagne
Date: 2008-02-07 20:03:41
Well, it takes a man and a gentleman to admit and retract what has crossed the line. I congratulate you on that, and offer that you have won my respect; I appreciate your apology; and hope we soon find ourselves, all of us, on the same side of the line, because there is one set of principles which serve us.
Furthermore, I understand your reservation regarding the two terms. Nonetheless, I presume you have a considerable mathematic background; and so while I agree that yes, usually such a proposition is offered without qualification -- and smells. At the same time, yes others are right here in asserting that conventional "economics" smells of the same thing -- it is wholly bereft of formal proof or theorem.
Just the same however, let us practice just a wee bit of the most elementary math, returning to the definition of inflation and deflation:
If each are respectively defined as increases or decreases in money per goods and services [or whatever], then I'm sure you are aware how we would perfect an economy of inflation and deflation; and of course, the process is "mathematical."
There is no stretch to that whatsoever.
Likewise, if interest is the process which multiplies debt in proportion to the circulation, we perfect an economy of irreversible multiplication of debt in proportion to the circulation by eradicating interest.
Because each, individually, and/or together, are the only way that the system manipulates the value or cost of money or property, therefore we have also solved intrinsic (systemic) manipulation of the value or cost of money or property.
By paying interest-free debts off at the rate of depreciation or consumption (which are to be understood to be equivalent) then, we have no inflation, deflation, or manipulation of value or cost.
I trust that's well within the scope of your field of expertise to acknowledge. Millions of software developers all over the world handle resource problems like this routinely, ever day.
I don't fault anyone for skepticism; if we had lived by the proper measure of skepticism, the so called Federal Reserve System would never have enjoyed a day of history. After all, it only took 15 years to disprove for the first time that it would be the cause of all that it promised to solve.
And today, "interest," is no longer the responsible process?
Just something to think about, as we plunge ever deeper into ruinous, insoluble debt.
I, obviously unlike most of the responders to this post, have read the entire web site of PFMPE <http://www.perfecteconomy.com/> as well as downloaded and reviewed the Excel spreadsheet, that is the proof of MPE. I can not understand how one can fail to see the the solution to the volatile economy the world has had imposed upon them by a handful of central banker.
The first challenge I have for all the responders is to download the spreadsheet and understand the MATH (formulas) that comprise the solution and reading the PFMPE site might help as well.
The mathematical proof, the spreadsheet, can just as well be applied to ones own run away credit card debt, the principals are exactly the same. At the point of inherent collapse the bank stops increasing your limit and you are bankrupt, unless you take out a second or refinance your first mortgage on your home, if you own one, and transfer the unsecured liability of the credit card to a secured mortgage for a lower interest rate. This, of course, means that when the next, delayed, inherent collapse of your personal finances arrives you lose your house as well as your credit rating. It's all in the math and undeniable.
Posted By: mike montagne
Date: 2008-02-08 12:10:58
Thanks, Steve.
Sean Michaels raises a good question, and as I read my reply, I think I should raise a few more thoughts which evidently aren't sufficiently obvious.
Sean rightly questions whether there has been a proving ground. That's a valid concern, but it should not be a critical one. I'll get around to why.
Even a generic trading system where there is true free trade without involuntary servitude of any kind, is proof of MPE, because MPE is the monetary equivalent of trade without involuntary servitude (as imposed by a privatized currency subject to interest).
So in fact there are many models, even if the American Colonial systems of scrip as outlined in our PARABLE of Perfect Economy were not an example and proving ground of most of the aspects of mathematically perfected economy.
But what if such systems never existed?
Does that mean, and should that mean, that in our timidness, we can never develop an economy free of involuntary servitude; equivalent to barter in regard to freedom of exchange, enterprise, and determination; and exceeding barter in terms of the convenience a monetary system provides for exchanging commerce?
It is for us to do that thinking, if we are to achieve above the status quo which is presently, again, about to bankrupt us.
To deny ourselves the critical opportunity to evaluate solution on the other hand therefore commits us to a model which has already been disproven!
Look around you, and all you will see is people paying lifetime after lifetime for homes that we produced. We are paying all this to a few unassented private individuals who produce nothing and risk nothing, because the money they subject us to is produced without cost and without risk -- "out of thin air" as some are saying.
We can no longer afford health care; we can no longer afford to maintain standards of education... the list goes on and on of the things we can no longer afford, because the costs of servicing perpetual multiplication of debt have vanquished prosperity.
When George Bush took office, we required $1 b in "foreign investment" to sustain the deficiencies engendered by this unassented system. Today, the figure may exceed $3 b. What advantage is there in persisting then in the broken model?
That model has already been shown to multiply debt upon us irreversibly. It is mathematically impossible to pay the sum of debt down if we maintain a circulation; and it is mathematically impossible to arrest the further multiplication of debt if we maintain a circulation, because we must re-borrow both what we pay against principal and what we pay against interest as a subsequent sum of debt, increased so much as periodic interest.
Look at history. Lincoln, Franklin, Jefferson, John Adams, Andrew Jackson... the list goes on and on and on... all of the greatest minds of our founding admonish us to be vigilant against the imposition of the system we are now, without our consent, and even without our due recourse... we are now the unassented, involuntary servants of.
The models I provided the Reagan Administration further prove MPE: ONLY when we enter 0 (ZERO) as the rate of interest, is the "economy" (today, simply a method of stealing from you) perpetually sustainable.
As Steve says, download our Excel spreadsheets, or even download our source code to the models I provided Reagan (you need an old DOS system and MS QuickBasic, and you have to know what do do with the source code), and go over the math yourself.
It's simple. There's nothing ambiguous. I spoke before the entire math staff of the University of Colorado at Colorado Springs about this in 1975, and there wasn't even an inclination toward a dissenting opinion. NO ONE EVEN ANTICIPATED THAT IT WOULD BE POSSIBLE TO DISPROVE MATHEMATICALLY PERFECTED ECONOMY -- IT'S JUST THAT CUT AND DRIED.
So there is nothing worse than apathy or inaction, because either are carte blanche to usury. If you want the consequences of usury, dis all the things the founders told us... and dis or ignore solution. But nothing more clearly distinguishes you then, from the illuminated era which founded this country.
You bring up some thought provoking ideas, but there is one area that I still question. Why would any business give a loan without benefit to the company and without any promise of being repaid? Secondly, if the government provided the loan, then the government would own all our property and assests until we payed off the debt. The price of goods could also rise in this model depending on how long we prolong the time to repay. Both models and alas our current system of interest and taxes both undermine our right to own property, because until we pay both off indefinetly, it does not belong to us. You are completely right about the ability of interest to be a run away train that eventually ruins us. However, it might be more wise, instead, to have everyone just unite together in a common understanding to fiercly live within our means. Perhaps instead of borrowing anything, we could instead save and purchase a house in cash, which would keep the real cost the lowest. Next, we could actively invest in our communities and sound business models in the place of government and banks, gaining a share of ownership. In conclusion, we become the owners and founders of our community, not the government and not the banks.
I really think Ron Paul would have caught on more if he wasn't being stone walled by corrupt media outlets like NPR.
I once loved them, but once I actually started to pay attention to what was going on, I realized how bad they are censoring the news. They are worse than Fox, and people trust them way too much.
They didn't mention Ron Paul at all leading up to Super Tuesday. They mentioned John McCain, Mitt Romney, and Mike Huckabee, even through Ron Paul did better in fund raising and primaries.
How can people vote for Ron Paul if they don't know about him?
NPR, is more guilty of fixing elections then Diebold in my opinion.
I plan to still work to support Ron Paul. Whether he wins or not, I won't to work to help support his ideas and ideals within the Republican Party.
Even if Ron Paul doesn't win, we should not give up, or we'll just be watching our country go down the drain. Let's all get involved
Lets not fraction off into the Libertarian Party, or the Constitution Party, because all that does is leave the Neocons in control of the Republican Party.
That's just what they want. I've come to the conclusion, people have been playing into their hands, all along.
I know many people won't agree with me on this, but we need to look at what issues unite usl, instead of what issues divide us. An example would be the Eagle Forum trying to fight
I know many people won't agree with me on this, but we need to look at what issues unite usl, instead of what issues divide us. An example would be the Eagle Forum trying to fight "The Gay Agenda" I believe there's an immoral agenda being pushed by some groups, but when you stick a label like that on a movement, you shove people into that group whether they belong there or not.
I have met many gay conservatives. I know one guy who could have started the gay league of the Moral Majority.
To reiterate what I'm saying, let's look for common ground among people to unite them, rather than looking for reasons to exclude people.
P.S. Check out all the inflation tax videos on inflationtax.blogspot.com I've emailed Mises.org a couple of times to see if they or “we” could mass produce Money Banking and the Federal Reserve on DVD, but I've never received a response.
We could hand the video out to people, You can buy 100 America Freedom to Fascism for $100. Mises.org could print their info on the labels and it could be a mass advertising campaign for them. You
Posted By: mike montagne
Date: 2008-02-09 19:50:43
You bring up some thought provoking ideas, but there is one area that I still question. Why would any business give a loan without benefit to the company and without any promise of being repaid?
I realize it's a bit of work, but if you read the cited material (particularly PARABLE of Perfect Economy), you could understand that we have two controversial (to each other) concepts. In both concepts the money is issued virtually without cost; so your assumption that a business or bank or central bank might issue that money at risk is in err, because the money is created without cost. Thus our two contending principles are:
We tolerate an extrinsic party issuing the currency without cost, and yet a) collecting the worth of that issuance (the principal) in terms of our production in return (thus collecting a profit, even in return of the principal, of many, many times their original cost [the mere cost of printing or electronic, etc. creation of the money "out of thin air"); and b) furthermore collecting all the interest on the original principal as further profit; and yet c) further collecting all the downstream interest and principal on the further multiplication of debt engendered by maintaining the circulation.
Or we can (likewise) create the money at virtually no cost, and manage the schedule of payment and nature of the currency so as it will not multiply debt into insoluble debt.
In the first case, we have private entities which you have assumed are at risk, but are at virtually no risk, because if they collect perhaps one in a thousand debts even, they will more than retrieve their costs, which are virtually nothing, multiplied many, times over.
If $10,000 costs ten cents to create, if they are repaid the $10,000, the private entity has made 100,000 times their "investment."
Furthermore, once the debtor pays ten cents toward the obligation, the creditor is no longer at risk at all; and at most, ever, their risk was a maximum of ten cents.
Furthermore still, if the creditor asks a further $10,000 for instance in interest their unearned and unjustified profit is 200,000 times their negligible cost.
And finally, as we are forced to perpetually re-borrow whatever we pay out of the general circulation toward the$10,000 principal and $10,000 interest obligations, having to perpetually re-borrow that back as a subsequent sum of debt, increased above the previous principal so much as periodic interest, then the orignal debt multiplies interminably (if we maintain a circulation) into infinitely greater unearned profit.
Once a usurer or central bank sets this process in motion, unearned and unjustified profit is multiplied perpetually and irreversibly, until an ultimate sum of debt exceeds the possibility it can be serviced. Ultimately the entire circulation would be devoted to servicing debt (if commerce can be sustained that long -- which is impractical; commerce is terminated before that maximum possible lifespan is reached, because there are other vital costs which must be afforded, if commerce is to be sustained).
The first case is unsustainable, because an irreversible process (so long as we maintain a circulation; and we must maintain a circulation) multiplies debt into insoluble debt. All the profit is unearned; all the unearned profit perpetually drives up the costs of all things (which must service debt indirectly or directly); and, for any measure of our own production, it is generally impossible to acquire but ever less of others' production, because ever more of the circulation is dedicated to servicing the artificial, unjustified multiplication of debt.
In the second case, we pay for the financed property with what we agree to be an equal measure of our own work (by agreeing to the price); debt is not multiplied; no extrinsic costs exist; no one makes or takes an unearned profit; and the cost of nothing whatever is driven up by the purported economic system, because the economic system imposes no cost whatsoever.
Secondly, if the government provided the loan, then the government would own all our property and assests until we payed off the debt.
No. We own them and possess them so long as we service the interest-free debt at the rate of consumption/depreciation of the related asset.
Moreover, the complaint you make applies manyfold over against the present, unassented system: You aren't the owner of any finance property unless you pay for the property several times over.
At worst, in MPE, we might not be considered the owner of the property until we have paid for the property *once.* But how else do you propose it should be? Is it right to give people property they haven't produced, earned, or paid for? No monetary system in history has even *sought* to do this.
But why should a monetary system provide you what you haven't earned?
MPE comes the closest to that we dare venture, because it entrusts you with a debt you have qualified to pay, and therefore allows you to enjoy ownership of the property produced by others, on the integrity of your commitment to repay your debt.
In MPE only it is always possible to repay that debt, for in the alternate system, the full obligation is far more than the original circulation (principal).
The price of goods could also rise in this model depending on how long we prolong the time to repay.
Unless you exercise price controls, the price of goods can rise or fall according to whatever causes. You say they "could" rise. But will they? Or would they rise as much, to as much a disadvantage as in the alternate system?
Nothing in MPE causes prices to rise. Therefore you *could* exercise price controls without damaging the subjects of the system; but I do not recommend to do that because the perpetual balances of MPE tend naturally, in and of themselves, to maintain consistent prices. As I've worked on models of this for so long, perhaps I can help you understand how.
At all times, the remaining circulation = the remaining debt = the remaining value of the related property. In MPE, the constant relationship of the circulation and debt can never change, because of our schedule of payment. All other things being equal then, there is no reason whatever for us to raise prices from proven profit margins.
What nonetheless if we did so?
We make the cost of our work disproportionate to the cost of equivalent work invested in developing the asset we are paying for.
To pay more *equivalent* work does not make economic sense -- but it only damages the person foolish enough to do so. So MPE tolerates unjustified price fluctuations, even if it rids all systemic causes of price fluctuation. There is no damage whatsoever but to the person who willingly pays $5.00 for the glass of lemonade they could have got for $0.50 next door. We still have all the money in circulation necessary to pay all our debt. The person paying $5.00 for their lemonade is going to work harder to pay their debts than the person paying $0.50 or charging $5.00.
Furthermore, only as a consequence of usury/interest are prices drivien up, because multiplication of debt by interest forces practically all productive entities to service greater debt and increase prices to maintain former profit margins. Likewise, markets servicing ever greater debt are paying ever more for our own production, owing to interest.
Both models and alas our current system of interest and taxes both undermine our right to own property, because until we pay both off indefinetly, it does not belong to us.
I have already answered this, but you are in error here unless you can show how you should own property you haven't paid for. Both systems allow you to take possession of the property as if you are the owner; and only if you default on your obligation to pay off the whole resultant obligation do you lose possession and all that you have paid toward the obligation.
But under the present system, the cost is several times the property. Under MPE your obligation is only the property.
Under the present system, not enough circulation exists to pay off our obligations. Thus we must borrow ever further. Moreover, as the system reaches the end of its lifespan, and as the costs of servicing debt consume more and more of the circulation, the possibility of your paying back the obligation is slimmer and slimmer; and is ultimately denied.
You are completely right about the ability of interest to be a run away train that eventually ruins us. However, it might be more wise, instead, to have everyone just unite together in a common understanding to fiercly live within our means.
But we convey our commerce by a currency, and by turning over the production of the currency to usurers for the sake even of unearned gain, our means are perpetually diminished until eventually they are extinguished altogether.
We need a currency. We deserve a currency. Currency makes trade convenient. The ability to borrow money into circulation is an advantage, because it allows us to enjoy the prosperity we will ultimately deserve, spread over the while that we pay for it.
Perhaps instead of borrowing anything, we could instead save and purchase a house in cash, which would keep the real cost the lowest.
See my PARABLE of Perfect Economy.
Today, we need a bridge. We might not have the cash. Furthermore, we know that over time we will be able to pay for the bridge. Why not then issue the money to pay for the bridge; pay it to the builder; and pay off the debt, without interest, as we consume of the bridge?
Note that it is wholly impractical across the populace to save so much as to pay for a house in cash under the present system. Sure, there are exceptions to the rule. But they are few and far between, and will be fewer and farther between... as interest multiplies debt at an ever escalating rate, and devalues the money therefore at an ever escalating rate, insofar as what home the money might eventually purchase.
Next, we could actively invest in our communities and sound business models in the place of government and banks, gaining a share of ownership. In conclusion, we become the owners and founders of our community, not the government and not the banks.
In the beginning of the lifespan of a circulation subject to interest, the far lower sums of debt generally make it practical to implement what we loosely refer to as "sound business models." Later in the lifespan, those models aren't enough. This is why you see all the phony leveraging, "interest only" mortgages, and all the present sort of thing. These are last ditch, desperate measures to extend solubility to take further unearned profit.
But in the end, the ever escalating increments of periodic interest on the ever escalating sum of debt consume all the circulation, and make it impossible for any "business model" to succeed.
In the end, there is no "sound" business model, for they all will fail. In the end, there is no sharing of the ownership of our community or government; today foreign governments own your government and even your debt moreso than you own anything.
There is no sound business model then; there is no investment in our communities; and certainly any share of ownership we might have of anything, can itself be reduced to ruin, unless we have mathematically perfected economy.
Posted By: mike montagne
Date: 2008-02-09 20:16:56
Yes, Mr. X, absolutely.
Please don't misunderstand me. I love the !#$#! out of Ron Paul. I really do. I mean I REALLY, REALLY DO!
That man is a breath of fresh air like we haven't had in a hundred years, and he has put his name in the highest places in our history books forever.
My problem is with his Austrian "Economics" staff, who I believe have cut me off from the man. I don't think he's ever heard of MPE yet. At least, I believe such an honest and straightforward man ought to provide audience. It makes little sense to me he hasn't. I just don't see him having an ego issue or some irrational pre-disposition sufficient enough that he'd reject solution before he even heard it.
I'm still hoping, and I even believe, while it would be a miracle, that if he had MPE in his lap, with my help, and with your support, he could pull off that miracle. I wouldn't bet on any other horse; and I'd certainly be willing to die trying.
I quote Jefferson above; and I have been doing so for 30 years... but few people realize how the incredible monetary advantages of a central bank not only result in the ability to own everything, but the *need* to own the media.
There's a disputed paper called the Hazard Circular. Bona fide historic document or not, it chronicles the necessary intentions of a central bank; and moreover it intimates how extensively they must control the media.
They own the media. It's just that simple. You follow the money; and you'll find they own the media. And that's why Ron Paul is such a courageous hero politician, because he stood up there anyway. Kennedy was probably killed for this. Lincoln was almost certainly killed for this. Look up our quotes page, and you'll see what Lincoln had to say about the central banks.
Both Lincoln and Jefferson almost arrived at the prescription of mathematically perfected economy. Jefferson issued observations which come so very close to identifying the minutae which predicate solution. He just didn't quite get there. Lincoln on the other hand, may have arrived at its realizations, but not lived to give them to us. The way he paid for the Civil War is pretty close to the best you can do in the way of paying for something which is negative, and cannot be represented as a hard asset. His solution avoided interest and multiplication of debt on the war ever afterward.
On your motion for unity, I adamantly agree; and in fact it is my vision that nothing could or should moreso unite this country than mathematically perfected economy.
As far as the ostensible gay issue goes, evidently we both agree with Ron, but it's been my feeling all my life. There's no place for persecution in our country. We've had enough of it. But when we look back is only when some of us see how ugly it is. We need to face it. Only ugly people do these things; and usually they do them because *they* are doing such ugly things, they want us to look another direction.
The darkest aspects of our history involve persecution. The brightest involve universal justice, and the United States' former great participation in the forefront of liberty, justice, transparency, and representation.
Note then that it is the so called "financial" institutions which most subvert all of these things, for their very existence transpires only by forfeitting them, and is only preserved by penetrating every entity and instrument which can be used to perpetuate usury at the cost of freedom, justice, and representation.
Thanks for patiently and throughly answering my questions. Your argument finally clicked. I guess that I need to start reading about your model in its complete form.
Anyways, I think that you should make a youtube video about your model that graphically illustrates the concepts. I think that it might be more effective for most people to see your concepts, especially since interest and the current banking system is so complex and so ingrained into our environment, it's hard to see that an alternative exists. All we know is that we don't like it, but it's that way and it has always been that way.
On another note, I was discussing monetary system with my husband today, and told him about your system (he is probably reading it right now). We also discussed Ron Paul's ideas (by the way I love Ron Paul too and voted for him, so this does not mean that I do not value his efforts). He had done some research about Ron Paul's proposal of backing up our currency with a gold standard. From what he found, the last time that we had our money backed by gold, our gold became so cheap because it held its original value, while all other nations had inflation/deflation cycles with there money. Because of these cycles, gold in other countries became very expensive, whereas ours remained artificially cheap (compared to other countries) since it was tied to our dollar. In the end, tons of gold got smuggled out of our country to places like Hong Kong. In essence, a gold standard could only work if all other countries abided by the same system, which isn't going to happen. Thus, I can see why your system may prove superior. However, (knowing that I still need to read about your entire system) how would your model prove immune to global interference? Basically, what policies would we need to implement to protect our market?
Posted By: mike montagne
Date: 2008-02-11 11:48:23
Dear Brooke,
Thanks so much for the constructive advice. You're absolutely right. I had diagrams in years past, but they still didn't register with people. I have plans to do exactly what you recommend, but I'm just one person. I'd have done it a long time ago if I weren't spending better than 15 hours a day providing technical arguments to citizens, advocates, politicians, campaignn staff, radio stations... your recommendation is still a way down the agenda of most important things first.
PURPORTED MERITS OF THE GOLD STANDARD
First of all, I'm going to reiterate how much I do love and respect Ron. His wife must be special too. I've heard about some of the things she's doing behind the scenes. Most of us should be able to tell a pathological liar when we encounter one. We've had a hundred years of them, as purported representatives, and the last couple of decades should have been the last straw. No public who can forget the standing allegations about Mena Arkansas, or the involvement of the Bush family in international banking can fail to put 2 + 2 together. Our problems are not just lack of integrity; they are practiced, wholesale deceptions, meant to undermine our country, our way of life, and most of all, the principles necessary for the well being of humanity. It's planned, and it's performed by men (and a few women) so arrogant that the magnitude of their personal irregularities is way off the scale of regular human perception.
That said, and while I believe Ron Paul has exemplary intentions and integrity, Ron Paul is an adherent of "Austrian School Economics." As you will see from several of the articles and blogs on my site, ASE has some very serious flaws. But you can readily determine for yourself by reading their material that their views, like conventional economics (which I refute as a system for stealing from us), are wholly bereft of formal proof or theorem. Neither CE or ASE are formal disciplines or sciences.
But particularly, ASE suffers the fault of wholly dismissing mathematics, on the assumption that no mathematics can account for human behavior.
This is a hollow assertion; and, like all precepts set forth by ASE, it has no formal proof whatsoever.
But worse, the precept is errantly applied by virtually all ASE adherents.
How do I say so?
MPE is not about human behavior. MPE is about the environment within which [whatever] human behavior can operate as we may or may not intend to be able to operate.
In other words, on the one hand, "conventional economics" (which we could more accurately describe as "free license to prey upon commerce even to its termination") engenders a perpetually transforming environment, in which the hapless subjects are forced to service ever greater debt, until collapse. This is not an issue of human behavior at all. It is an issue of a mathematic process which multiplies debt upon them until failure; and so if we dismiss mathematics for the false/erroneous reason that mathematics cannot answer for "human behavior" (which is not even an element of the environmental irregularities we must understand here), then we can only fail both to identify and to solve the problem.
I've had literally hundreds if not thousands of arguments with ASE adherents. Not only do they uniformly refuse to recognize the inherent, irreversible multiplication of debt by interest; they actually advocate interest; and even straying further from necessary identification and solution, they advocate "freedom" of *many* "free markets" (opportunities to steal from us) as the ostensible basis of sound money. They argue for these all, errantly citing an unqualified fact that mathematics cannot answer for human behavior (even though human behavior is not the issue -- the issue is injustice, and perpetual deterioration of the environment by interest).
So these are huge fundamental flaws in the very foundations of ASE; and if you want a deluge of irrational arguments, all you have to do is invite ASE adherents to the discussion.
Ron's proposition (perhaps abandoned already, if you read his latest "Comprehensive Economic Revitalization Plan") of dissolving the Federal Reserve System is a perfect example of the flaws engendered by dismissing mathematics. How then do you even quantify the ramifications of any proposition? In the end, if ASE advocates mere "competing" usurers issuing various private currencies, this corresponds to the historic precept of the "competing" banks of the late 1800s and early 1900s, the destabilization and calamity of which brought a call for banking reform. Well, this call, like today, was a hollow call for "change." What change we were delivered, instead of dissolving the banking system, eradicating interest, and solving the issues at hand (MPE), brought on *consolidation* of the banks under what is even purposely deceptive terminology: "The Federal Reserve System."
So, "competing" currencies, however contrived, if they retain interest, are subject to the same process we suffer under the imposed deceptions of the so called Federal Reserve System. Interest will still multiply debt into insoluble debt. It may or may not do so at faster or slower rates; but it will terminate commerce.
Now, the Austrian School claims the Gold Standard will protect us from this. They claim that it will maintain consistent prices. I say, and am about to show... NOT SO AT ALL!
First of all, we HAD a gold standard ALL THE WHILE ALL THESE DETRIMENTAL PROCESSES TRANSPIRED. We had "inflation" (mis-expressed as rising costs/prices). We had multiplication of debt.
So there is no historic argument which supports Ron's proposition of returning to the gold standard (which he vacillates on -- you notice that in some cases he advocates backing the currrency with hard assets; well, MPE is THE SINGULAR prescription by which we back a currency at all times with THE remaining value of the related circulation ALWAYS equalling the remaining, related circulation).
Furthermore, as I have argued hundreds of times, the gold standard has no power whatsoever to solve inherent, irreversible multiplication of debt by interest. What is going to happen if you return to a gold standard then is you are going to find out (by history proving once again):
Multiplication of debt by interest will still impose ever greater costs of servicing debt on commerce; thus prices must perpetualy increase at an ever escalating rate to maintain margins of profitability/solubility;
Multiplication of debt by interest therefore will still transfer all property to usurers who create the money at virtually no cost, risk nothing, and contribute nothing whatsoever to the pool of wealth;
Thus you will LOSE all your monetary gold TO THEM (because they own all the money from the beginning to the end);
AND FURTHERMORE, you will still suffer collapse under insoluble debt.
What is more, the purposes of a gold standard (or any other monetary standard than MPE) exist ONLY to guarantee the value of a form of money which not only CANNOT BE GUARANTEED, but, because of the process attached to it (interest), which can instead by guaranteed to do all the things we are trying to protect ourselves from by invoking the (inherently failing) "standard";
And finally, if you honor your gold standard, you can never issue the greater quantities of circulation which are necessary to sustain commerce, the value of which may (and will) exceed the purported value of "monetary reserves."
Only MPE solves all these issues; and only MPE does not require a gold (or any other) standard, because at all times the equivalence of remaining circulation, remaining value of related assets, and remaining debt guarantee insofar as a system can guarantee, a constantly consistent value of money.
So the gold standard is disproven historically. It failed.
Moreover, all the reasons it failed and can only fail are hereby exposed to you.
So Ron's claim, and ASE's claim that a return to the gold standard can save us is in fact (imho at least) wholly preposterous. Why haven't I heard from Ron Paul? Why won't he debate these issues with me, if he will not adopt MPE?
I don't take the evasion as a good sign.
So I say the research is disinformation, which simply ignores the obvious mathematic facts. I raise my voice because I don't want Ron Paul or this movement to fail. I am still going to vote for Ron Paul; but I am still going to count on my perception of his sensibility and integrity to bring him to the table of MPE, and to pound out the truth regarding what will really solve the issues of the American people, and the world.
This issue is larger than us. It is an international issue. Through U.S. hegemony, central banks have been imposed upon the whole world. Usurers seated here and usurping our government have leveraged the power of this country and our misunderstandings of the deceptions they have proliferated upon us... they have leveraged this into a world-wide system of oppression. Congressman Louis T. McFadden pointed this out during the first Great Depression (see our site for that material).
But thus Ron's misconceptions about the gold standard are dangerous to us. Thomas Jefferson said, "The system of banking is a blot [defect] left in [unsolved by] all our Constitutions [state and federal] which, if not covered [solved], will end in their destruction. I sincerely believe that banking institutions are more dangerous than standing armies; and that the principle of spending money to be paid by posterity is but swindling futurity on a large scale."
MPE is the solution Jefferson was looking for. If you study Jefferson and Lincoln particularly, you will see that MPE was on the tip of their tongues.
But Ron Paul erroneously draws together the false hope the gold standard can save us and a purported "freedom" of competing currencies (he's even introduced recent legislation to that effect) as if that comprises solution. He further makes the false assertion that whatever prosperity we ever enjoyed is at least in part attributable to the gold standard.
Well these assertions aren't so. There is no free enterprise, if, via privatized currencies (singular or plural), all that we can produce we can be dispossesed of (as Jefferson puts it). Free enterprise and "interest" are mutually exclusive conditions.
Nor can we simply say that a gold standard was *responsible* for our prosperity.
Why not?
Well, just for instance, it is mathematically impossible for a gold standard to maintain consistent prices (as Ron often asserts), because interest multiplies debt; and therefore if interest is present at all, the ever greater costliness of ever greater debt imposed by interest forces prices to rise if industry is to remain solvent.
So while I share his hope and intention for solution, Ron is just plain wrong on all these counts. How better can I demonstrate that?
Well, I believe I have demonstrated it even better.
If you study our Parable of Perfect Economy, you will see how. There was no gold standard in the colonies; they issued various currencies; but (according to the thrust of the parable), most of all individuals issuing promises to pay did not make their promises subject to interest; and if there is a shred of historic *OR THEORETICAL* truth to this process... then we can see that the elements, gold or silver, are hardly necessary to human prosperity.
Mark my words. One day, perhaps not far off, we will acknowledge (as Jefferson and Lincoln may have) that the idea is preposterous.
So I still hope to hear from Ron Paul. Evasion of these propositions is the last thing I would expect from my reading of the man. I fear on the contrary, that it is ASE adherents within his campaign staff who have cut off MPE not only from Dr. Paul, but from the American People.
I will say it again: We need MPE. It's our only solution.
Posted By: mike montagne
Date: 2008-02-11 12:05:45
Sorry. I didn't proof read that. A quick look spotted an error:
"with THE remaining value of the related circulation ALWAYS equalling the remaining, related circulation"
...should read instead as...
"with THE remaining value of the related circulation ALWAYS equalling *the remaining value of the related assets* and corresponding debt"
It is this concrete linkage by which MPE gives the currency consistent value.
A gold standard cannot provide that concrete linkage unless:
the value of the monetary reserves always exceeds the value of all related assets (making it possible for us to issue the circulation our commerce/industry requires);
the nominal value of gold truly represents the related assets;
a schedule of payment maintains a circulation which is always equal to remaining debt and the remaining value of related assets (as in MPE);
Thus there can be no interest, because interest corrupts the constant relationship it is necessary to maintain, wherein the remaining circulation constantly equals the remaining value of related assets and the [whole] debt/obligaton related to both.
Mike,
I am currently going through your website. It is very thought-provoking and exciting.
What do you think of Gold Standard PLUS abolition of Fractional Reserve Banking? Would it not accomplish the same purpose?
What do you think of Terra - the proposed currency backed by a basket of commodities? (www.terratrc.org).
Is your system similar to the complementary currency systems like LETs?
What do you think of demurrage charges on currency?
I am trying to understand the actual mechanics of implementation of your system. Who would issue the currency? How to determine the exact amount to issue i.e. how to value the underlying asset? How to prevent fraud (i.e default) or overissuance by a government? Can you address some of these details with examples.
Thanks
Posted By: mike montagne
Date: 2008-02-12 17:28:51
Thanks for the questions and kind words, but please review the comments to see that I've already responded to most of your requirements. To make sure I've covered the bases, I'll re-summarize previous answers.
MPE has no need for what I call an alternate or secondary monetary standard? Why, only MPE maintains a circulation which at all times is equal both to the remaining value of related assets and to the remaining debt. It is this constant and perpetual relationship maintained by MPE which ensures (as much as any system can ensure) that the value of the money is not only constant, but consistent with all intended purposes.
There is no need whatsoever for a gold standard therefore. Furthermore, see that I have already explained how a gold standard has no power whatever to arrest/avert multiplication of debt by interest (only eradication of interest can do that). There are articles on our site which further explain that.
As to the other systems, I am going to put my foot down. I've been advocating singular solution since ten years before 1979 (when I formally published my proof that any economy subject to interest ultimately terminates itself under insoluble debt, and that there is one and one only solution to the classes of irregularity imposed by the world's central banking [usury] systems).
Even fifteen years ago there were no competitors to MPE; and anyone who plagiarizes my singular solution risks my wrath. Many splintering groups at one time or another touched base with me. Even the folks printing the alternate coins who are now in trouble asked for my blessing. I have given none of them my blessing; and I'll tell you why -- there is no legitimate deviation from a singular solution.
The so called "Money Masters" borrow hugely from my work -- even using my exact words for I don't know how many things -- and then propose non solution.
Why?
For attention and profit. That's all.
Invite *any* of these people to debate their "solution" versus "mine." The can visit our new forum. Many of us have had debates in the past you could know little of, because they were conducted privately.
But MPE has never been disproven. Never.
The REAL questions therefore are why did they splinter off, instead of supporting the singular solution? And what have they accomplished by advocating that a singular solution can be adulterated?
A currency backed by a basket of commodities is an example of redundant, sloppy engineering. Why use anything but the related asset itself? What better represents every penny then that is ever introduced to circulation? Why have an alternate monetary standard at all; and what principle guarantees that its difference regardless of any natural transition (such as a different rate of depreciation for instance), are accounted for?
MPE handles all these issues.
OK. Ditto for LETS. These people contacted me years ago. Why LETS ("Local Exchange Trading Systems")? How is LETS even an invention? Barter is an ancient system; and in the end, MPE accomplishes all its purposes.
But what advantage to you have in LETS localized within a usury system, particularly as whatever trade transpires is still responsible for sustaining debt and other artificial costs imposed by usury, and neither can LETS arrest multiplication of debt?
In the end, you are only going to "trade" the same things you would via currency, and you have no advantage whatsoever. The whole purpose of a currency is to allow illimitable, unencumbered trade. When you go to the market with a goat, wanting 37 chickens, and the person who wants your goat has none, but a third person wanting that second trader's product has the chickens, one or each of you might have sought each other out, then written your committments out and secured the trade at some painstaking.
But if you had currency *equivalent* to the value of each, you bought your chickens and sold your goat. Simple.
All the problems are introduced when a third party who produces nothing privatizes the currency for the sake of unearned profit.
Worse, when the process by which they take the unearned profit is not a static charge as the rest of us take payment, but a dynamic, perpetually multiplying, ongoing charge which ultimately terminates all commerce by complete dispossession... well, if the subject society hasn't demanded to understand the rectitude of that unassented process by that point... you have what we have now -- a whole lot of non-solutions, among which solution might be a needle in the haystack.
OK. Enough of that.
Who would issue the currency? WE do, via representative government.
How to determine the exact amount to issue?
Again, you do. MPE doesn't impose a collectivist concept of evaluation upon you. But you might determin
2008 mike montagne (PFMPE), all rights reserved.