How to steal everybody’s money in seven steps


The United Kingdom is drowning in debt. A radical plan how to get rid of the problem is proposed by the Cobden Center. If you find a flaw in the plan you will get £1,000 reward.

It is not the latest spam coming to your e-mail from the UK. It is a real plan that is endorsed by economists and politicians like the member of the British Parliament Steven Baker.

In just seven steps £850 billion magically appear in the system and allow the Great Britain to pay off the debt. You can get the details here and try your luck for the reward.

The plan starts with the government printing approx £850 billion in cash and injecting it directly into the vaults of the banks and into the checking accounts of individuals.

Wipe from the bank books all the demand-deposits/IOUs as banks would not owe you money anymore.
The banks don’t have to pay you anymore; they will suddenly be £850 billion better off.

The government can now get the money that the banks don’t have to pay back to the people and put it into Mutuals, which would then immediately pay off the national debt.

In the complicated world of the elitist politicians and economists this is not inflationary, as “the cash replaces the demand-deposit which acted as money”.

In my world view this is either the government monetizing the debt or the banks stealing the money from all checking accounts. So I asked the Man behind the plan directly.

The following is my exchange with MP Steven Baker:

Ellie Velinska:

MP Baker, Sir.

I am not your constituency but I have a real disagreement with the plan Toby and you present here.

Why do you have to do all the shenanigans in between when all your plan is doing is this:

“… the government printing approx £850 billion in cash…
…which would then immediately pay off the national debt…”

Why all these change of hands, smoke and mirrors?

Let’s say John in your constituency owes the government taxes (£1000). Let’s say you print £1000 and ship them to John’s safe from where they will go directly to Her Majesty’s Revenue and Customs.

Then you wipe off John’s tax liability and now John is suddenly £1000 better off. So the Gov can take £1000 from John and invest it in mutuals and pay off the debt.

Why? The government can just print £1000 and plug whatever hole they have around with them.
Why bother John? Why all this paperwork, shipping and handling.

In your bio you say “I value achievement over process and humanity over bureaucracy.”

However your plan, described here by Toby is just a bureaucratic waste of time in attempt to make monetizing the debt look better than just running the presses.

Steven Baker, MP:

Ellie,

First, “Steve” will do!

I understand why you make that criticism, but it is misplaced. The money supply, as properly understood[1] is not changed by this reform which merely swaps credit money for paper money, creating no change to the money supply.

The national debt is paid off using the existing assets of banks. Those bank assets were created through credit expansion and it is therefore reasonable to require the banks to exchange them for cash, wiping out the credit money they created and stabilizing the money supply.

I am not going to contribute further on this thread. After all that has been written here in explanation, the next course of action is for interested readers to see Jesus Huerta de Soto’s “Money, Bank Credit and Economic Cycles” which is available here:

http://www.cobdencentre.org/?dl_id=4

Since everyone at the Cobden Centre has other work to do and with regret, I am going to turn off comments on this post. Please read Huerta de Soto or Fisher’s “100% Money”[2] for more information.

Steve

[1] http://www.cobdencentre.org/2010/05/what-is-money/

[2] http://www.cobdencentre.org/2010/01/100-money-irving-fisher/

Yep! This is what you get from politicians. They are often too busy to talk to the regular folks. They also believe that people are just stupid and need to read more books instead of bothering them.

Politicians just like to brag about how they like to listen to the people. Mr. Baker even posted a reward asking people to express their thoughts on his plan. But when having to deal with regular folks who do not belong to the elitist circles politicians like MP Steven Baker get easily annoyed and get too busy to chat with ya all.

We the stupid people can be very annoying, but if you are not ready to deal with it – do not become a politician, Mr. Baker!

10 Responses to “How to steal everybody’s money in seven steps”

  • imp:

    This sounds like Ellen Brown’s plan to wipe out all debt (see Web of Debt) with the ‘click of a mouse.’ If you understand how fractional reserve banking works, it actually makes sense. The problem is if somehow new credit is issued on top of the monetized credit. Then you get triple digit inflation before you know what hit you. Good luck with that.

  • imp, I am sure the economists read a lot about money, but let me tell ya how hyperinflation feels.

    My parents had their life-savings in a timed saving account. When the USSR collapsed hyperinflation followed. When the time for the money to be unlocked came – what was supposed to be a down-payment for a home was just enough to buy a VCR (recording one).

    It is one thing to speculate about inflation in the smoke rooms of the British Parliament – it is quite different when hyperinflation hit ya.

    Mr. Baker presented above offered cash reward on his blog and then complains that folks are bothering him.

  • Jonascord:

    The Honourable Mr. Baker might be advised to put a call in to Robert, “The Economist” Mugabe, and ask how that “print your way out of debt” thing is working. As I understand it, the $Z isn’t even a very effective bum wipe, and Mr. Baker want to do the same thing to the Pound.

    However, here in the States, we have our own Mugabe, and I’m sure his merry band is dreaming up something just as horrifying, with the added bonus that somehow, they can personally profit from the manuever.

  • Jonascord, have you seen the Zimbabwe One Trillion Dollars bill?

    I have it as a recommended design for the US Congress gym shower curtains here:

    http://www.bigbureaucracy.com/?p=597

    It will work well for the British Parliament too.

  • mrg:

    Hi Ellie,

    I think you’re being unfair.

    The man behind this particular plan is Toby Baxendale.

    In the comments, Mr Baker wrote:

    “A number of schemes are available, but I am provisionally a supporter of Jesus Huerta de Soto’s plan as described in “Money, Bank Credit and Economic Cycles”. Toby is explaining the first step of that plan.”

    Here we have a politician who recognises that our financial system is fundamentally rotten, and wants to do something about it. If you read his website, you’ll see that he’s very much in favour of sound money (against inflation), and very much opposed to Big Government and Big Bureaucracy. Read this from his foreword to Eamonn Butler’s “Ludwig von Mises – A Primer”:

    “My particular choice among Mises’s works is Bureaucracy. We learn that, for all the management styles and tools we may know, there are just two alternative categories of management: the private citizen’s way and the government’s way. That is, profit management or bureaucracy. Until we come to terms with profit as a measure of the value we have created for others and entrepreneurship as the creative search to help other people, our public services will languish: unhampered market prices are vital to rational economic calculation.”

    You think Toby’s plan is inflationary; others, including Mr Baker disagree. This is an honest difference of opinion, not some sort of con trick.

    Politicians don’t have infinite time, and they have to prioritise their constituents ahead of others. Mr Baker has no obligation to you, as a US citizen, but he has been good enough to provide you with links for further reading.

    If you can’t face Huerta de Soto, I strongly recommend the Mises Primer noted above. It’s available free online, and it’s very readable.

    http://www.iea.org.uk/record.jsp?type=book&ID=514

  • MRG, if you read the comment section, MP Baker confirmed he endorses Toby’s plan. I specifically asked him. So there is nothing unfair here.

    Ellie Velinska:
    May 31st, 2010 at 18:34

    MP Baker, do you endorse Toby’s plan?

    *
    Steven Baker MP
    May 31st, 2010 at 22:22

    Ellie,

    I am a director of The Cobden Centre and therefore, as you would expect, I endorse monetary reconstruction. My articles are available here:

    http://www.cobdencentre.org/author/sjbaker/

    A number of schemes are available, but I am provisionally a supporter of Jesus Huerta de Soto’s plan as described in “Money, Bank Credit and Economic Cycles”. Toby is explaining the first step of that plan.

    Steve

    Glad you are joining us for the discussion.

    I am reading. It is not an easy task for the plebeians. If you can explain it to us. Go ahead!

  • I am aware that I do not belong to MP Baker’s constituency, however nowhere on his blog it is noted that the £1,000 reward is only for Wycombe residents.

  • I want to thank everybody who pushed the door to keep it open – the debate at the Cobden Center is open again and the £1,000 reward is still in play.

  • I’m always trying to distill it down to the simplest argument so we don’t end up with so much smoke and so many mirrors.

    How about this,

    Next year, the Govt is proposing to Borrow £150 Billion and issue that into the economy, ( to pay civil servants, doctors, nurses, police, armed forces etc etc )

    Instead of Borrowing that money, the Govt should just Print it, exactly the same amount of money will be in circulation but there will be no debt.

    I’m not saying we can print money willy nilly, I’m advocating, with due inflationary caution, ideally, Govt should shrink drastically and people may also barter and use other systems in tandem if they wish, such as Gold, Silver, Palladium, Platinum etc coins.

  • Dear Adrian Peirson, I am sure if you look really hard, line by line in the budget, you can come up with cuts that will make borrowing or printing the money unnecessary.

    My grandma used to say: balance your budget. It is not a radical idea.

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