The Bank of Nations: A Proposal

There is a missing international institution. Today we have the United Nations, an assembly of nations without the most important instrument of modern government, the power to issue money. We have the International Monetary Fund with the responsibility to regulate currency exchange rates, which it does in favor of rich countries, and we have the International Bank for Reconstruction and Development known as the World Bank whose role is to encourage poor countries to borrow money from rich ones, which puts them in a debt trap. The actual governors of the world today are the central bankers that create money and control its supply worldwide.

Central bankers have been very careful to make themselves independent of National governments. Here is the statement of independence for the European Central Bank from its website.

"Neither the ECB nor the national central banks (NCBs), nor any member of their decision-making bodies, are allowed to seek or take instructions from EU institutions or bodies, from any government of an EU member State or from any other body." http://www.ecb.int/ecb/orga/independence/html/index.en.html

Banker Mayer Amschel Rothschild in 1790 is reputed to have said, "Let me issue and control the money supply of a nation and I care not who makes its laws." So we have today in what we suppose are Nations governed by democracies, Nations in fact governed by bankers whose policies Nations are forbidden from influencing.

The Bank of Nations would combine the functions now incorrectly parceled out to different independent institutions.

1. The Bank of Nations would be a bank of issue; it would have the power to issue money.

2. The Bank of Nations would be owned and controlled by its member Nations. Any Nation could join on the condition that it accepts an Hour of Work as the standard of a fair wage and a fair price with variations negotiable by the people directly involved.

3. The purpose of The Bank of Nations would be to issue to its member Nations money denominated in Hours of Work debt-free and interest-free in sufficient amount to maintain productive and ecologically sustainable employment of its people.

4. The Bank of Nations would operate by cooperative rules; namely, each member Nation would have one vote and any income above its operating expenses would be refunded to its member Nations proportional to their contributions to that overage.

The Bank of Nations would combine in one institution, control by its member Nations, the power to issue money and regulation of its value and supply.

The problem is a borrowed money supply.

All our money is borrowed.  It has been that way since 1790. 

How is that a problem?

Where do we get the money to pay interest?

We get it from the borrowed money supply.  So when we pay interest, we reduce the money supply and find ourselves in a “panic, depression, or recession.”  In the 200+ years of the history of the United States, we have had about 50 of them.  Our guidance system is not working very well.

We can end the growth in debt by all but ending interest.  Bring it down to zero to 1/4 of one percent, like the FED did for banks borrowing from each other.

James Jackson, first congressman from Georgia, warned the First Congress on February 9, 1790, if they adopted Alexander Hamilton’s plan to fund the debt, “Though our present debt be but a few millions, in the course of a single century it will be multiplied to an extent we dare not think of.”

Total debt, not just Federal debt, hit a ceiling of $70 trillion in 2008 and we cannot increase debt enough to keep up with the debt growth trajectory.  We must bring interest down near zero.  A small amount can pay banks as a fee for service.