Canadian currency

JAMES CLAYTON

Canada is described as a democratic constitutional monarchy with a sovereign as head of state and a prime minister as head of government. The state, embodied in the sovereign and often referred to as “the Crown”, claims ownership of all the land within its geopolitical boundaries and claims sovereignty over the population within its territory. The capital and shares of the Bank of Canada and the Royal Canadian Mint are also held on behalf of Elizabeth Windsor, Her Majesty the Queen in Right of Canada.

National currency is not a benign medium of exchange or a reliable store of value. It demands economic growth but is systemically scarce, which keeps us in a collective state of perpetual debt, restrains economic activity and leads to a shortage of paid employment.

Every dollar is “borrowed” or credited into existence as interest-bearing debt, and the interest has to be obtained from money that is also created as interest-bearing debt. Total aggregate debt, including principal and interest, is always more than the total amount of money in circulation.

Money, in the form of credit and “loans”, is created by the financial institutions. Government obtains credit from the financial institutions and then passes its debt to taxpayers, but taxes must also be paid with money that is created as interest-bearing debt. The central bank manipulates the price of credit by influencing interest rates, which influences decisions to “borrow” and spend and affects demand for goods and services. Legal tender notes and coins, which represent only a very small portion of the money circulating in the economy at any one time, are distributed to the financial institutions as tangible tokens of credit.

When new money is brought into circulation it adds more money to the economy without necessarily bringing more goods and services to the market. This can lead to currency inflation and price inflation, which erodes the value of savings.

There does seem to be an increasing level of dissatisfaction with the political and monetary systems, but there isn’t a consensus in defining or solving the problem. This poses a challenge if we expect everyone to follow the same route, but maybe a wide range of choices is part of the solution.

There are already many options available. As consumers we can select from an ever-expanding array of goods and services that are available from a variety of producers and providers, and we can customize some of our purchases. Buyers and sellers can use alternative methods and media of exchange, including mutual credit clearing, community currencies, cryptocurrencies and commodity money, and different arrangements can operate concurrently in any location to facilitate trade. We can also seek membership in different organizations and associations with diverse social, economic and political interests, and various groups can coexist in the same geographical area, often intermingling and overlapping.

Different businesses and groups could compete or collaborate to attract new customers and members, based on the quality and price of any products or services offered, including instruction, health care, protection, and dispute resolution. Autonomous groups could make their own decisions about governance. Organized communities do not need to be defined by contiguous properties, restrictive geopolitical boundaries, or exclusive territorial sovereignty and jurisdiction.

Decisions about group affiliation and the exchange or distribution of goods and services can be made without imposing one’s preferences on anyone else or forcing anyone to relocate, and without any coercive monopolies, mandatory membership, compulsory production, or imposed monetary systems. This would certainly give us more control over our activities and interactions.

Various communities, arrangements and systems can exist simultaneously in any locality for the mutual benefit of all voluntary participants, at their own risk and expense.

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