THE Global Justice Movement Website

THE Global Justice Movement Website
This is the "Global Justice Movement" (dot org) we refer to in the title of this blog.

Friday, May 5, 2023

News from the Network, Vol. 16, No. 18


Shades of 1907 all over again, but with a vengeance.  The “Bankers Panic” of 1907 was caused by a commercial bank using its assets to speculate on Wall Street and another, bigger bank shutting off clearinghouse privileges to deny access to additional reserves to avert a panic.  The bigger bank — J.P. Morgan — then used its financial power to take over the smaller bank and save the day . . . and increase demands for a central bank that would put a stop to such things and put the reserve currency on an asset-backed basis instead of being backed by government debt (which had been an aggravating factor in the Panic of 1893 and the subsequent Great Depression of 1893-1898).  Sound familiar?  Then maybe it’s time to restore a sound financial system by adopting the Economic Democracy Act:


• Misunderstanding Money (Again).  The experts are in a panic as M2 — the supply of money presumably devoted to investing in new capital formation — is being depleted for consumption purposes, that is, used as if it were M1.  In other words, people are using their savings for consumption instead of investment, causing the experts to demand the government create more, more, more money for investment . . . meaning to pour into Wall Street to drive up the price of existing capital to benefit the speculators, while neglecting the needs of the private sector by raising interest rates to make new capital formation more expensive and thus less feasible.  Of course, if the experts ever realized that existing savings are best used for consumption and future savings are best used for new capital formation, as proposed in the Economic Democracy Act, the problem would solve itself, but nobody seems to realize that.


• How Do Banks Work?  Not Like This.  At the same time that people are complaining that banks are failing because they have too much money and then not enough, the claim is also made that at least half of America’s banks are already insolvent.  All this proves is that the so-called expert have no idea what the categories of banks are.  They think that all banks are “banks of deposit,” that can only lend what has been deposited.  No, the banks that are in trouble are commercial and mercantile banks, which are combinations of banks of issue and banks of discount, and which should never have to worry about not enough or too much money as long as the loans they make — and thus the money they create — is for good loans that are adequately collateralized.  And what is the best form of collateral for a modern economy?  Capital credit insurance and reinsurance.  When a loan goes bad, it is reimbursed in cash instead of having to seize collateral and sell it, usually at a loss.  That is one of the reforms proposed in the Economic Democracy Act.


• Unwinnable Financial War?  Is the “economic war” against a bad economy and an unworkable financial system “unwinnable”?  It is if you don’t know what weapons to use or who — or what — the “enemy” really is.  There are three very bad assumptions that prevent the so-called experts from coming up with a winning strategy. 1) The fixed belief that only existing savings can be used to finance new capital formation, 2) the fixed belief that the only way most people can gain income is by wages or welfare, and 3) the idea that money and credit are a commodity like any other, instead of a way of measuring value, and carrying out exchanges.  Insisting on these disproved beliefs is like a general in a modern war insisting on arming his troops with spears and clubs and expecting them to defeat tanks and machine guns.  If the powers-that-be are serious about “winning” the “economic war,” they might want to consider the reforms contained in the Economic Democracy Act which are based on the proven facts that 1) future savings can be used to finance new capital, 2) people can gain income from capital ownership, and 3) money and credit are a means of measuring value and of carrying out exchanges.


French Financial Fiascos.  France is once again caught in a Catch-22, or a “doom-loop” as the experts are calling it.  Surprising everyone, they can’t figure out why they just can’t print up money to fund social programs without ever having to pay the bills, and when the bills come due, and they try to cut social programs, they don’t understand why people object.  At the same time, they punish the rich and the productive for being rich and productive and force them out of the country where they take up residence in various tax havens throughout the world.  They don’t understand what the French government understood a century and a half ago after the Franco-Prussian War: that if you want to get out of debt and fund any kind of government program, you have to produce marketable goods and services.  These are the principles behind  the Economic Democracy Act., which would go a long way toward fixing France’s — and the world’s — problems.


• How NOT to Fix the Banking System.  Elon Musk has come up with an old idea on how to save the banking system: only put money into banks too big to fail so that if they do fail the government has to bail them out.  Want to know the real way to solve the banking crisis?  Don’t insure deposits, insure loans with capital credit insurance and reinsurance, and use the central and commercial banking system as it was designed to be used.  These are the reforms proposed in the Economic Democracy Act.  The only caveat is that it will take total power away from the rich and the government, and vest some in ordinary people.  Musk and other billionaires won’t like that.


• Raise the Rates!  What do you do when there is too much money going into speculation and consumption and not enough into new capital formation?  Raise the interest rates!  This ensures that businesses will find it more expensive to finance new capital formation, consumers will stop spending on consumption to support the economy and save their money, and gamblers will shift from “blue chips” to speculative issues to make more money.  Of course, they could start acting rationally and adopt the Economic Democracy Act, but that would make sense.


• As If the Whole Country Takes a Pay Cut?  Another expert has said that a new recession would be bad enough that it would be as if all Americans took a big pay cut, thereby cutting demand and entrenching the recession still further.  Of course, the prediction is based on the assumption that wages and welfare are the only means by which most people can get income.  Once the experts realize that ordinary people can use capital income for consumption, and that new capital formation can be financed with future savings, the whole Keynesian scenario falls apart of its own dead weight and contradictions.  The real solution to avoiding a recession or overheated economy is found in the Economic Democracy Act, but nobody seems to be considering that.


• Modern Plagiarism.  Admittedly, it’s hard being a student today within an environment in which absolutes and truth have been redefined when they haven’t been eliminated altogether, and “originality” consists of coming up with some new perversion of truth to get a degree.  As one eminent historian remarked almost a century ago, the modern Ph.D. system, which requires an original contribution to thought, is custom made to encourage such perversity, and can even be considered cruel in “a field as well-ploughed as history” and other social sciences.  It comes as no surprise, then, that students have turned with enthusiasm to “chatgpt” and other AI programs to write papers, and even “authors” are writing books, including fiction, completely with AI “assistance.”  The main problem, of course, is that if they’re caught, they risk a bad grade or expulsion.  Another problem is that, even when something escapes detection, it tends to be boring, as hundreds of self-published tomes have demonstrated.  It’s a terrible choice.  If you want to be original, you’re run the risk of departing from the truth, and if you use AI to assist you (or do all the work) you bore people.  It looks as if the arts will remain the bailiwick of the truly talented and the competent craftsman for a while yet . . . but the amount of drek will increase dramatically.


• Krazy Keynesian Theory.  Here’s an economic paradox for you.  It’s presumably an iron law of economics that — everything else being equal — as the supply of something goes down, the price goes up, and if the supply goes up, the price goes down.  So, why does it happen in Keynesian economics, which relies heavily on the law of supply and demand, insist that if too much money is in the system, you raise the price of it, and if there’s not enough, you lower the price?  Simple: The laws of supply and demand do not apply to money and credit because they are not a commodity . . . even though Keynesian economics is predicated on the assumption that money and credit are a commodity . . . just not to be treated as one unless it is convenient to do so.  That is why the antics of the Federal Reserve with respect to interest rates make no sense whatsoever.  If money and credit are a commodity, then treat it as such.  If money is a symbol for marketable goods and services, then stop backing it with government debt.  It’s as simple as that.  This is at the heart of the reforms proposed in the Economic Democracy Act.

• Greater Reset “Book Trailers”.  We have produced two ninety-second “Book Trailers” for distribution (by whoever wants to distribute them), essentially a minute and a half commercials for The Greater Reset.  There are two versions of the videos, one for “general audiences” and the other for “Catholic audiences”.  Take your pick.

• The Greater Reset.  CESJ’s new book by members of CESJ’s core group, The Greater Reset: Reclaiming Personal Sovereignty Under Natural Law is, of course, available from the publisher, TAN Books, an imprint of Saint Benedict Press, and has already gotten a top review on that website.  It can also be obtained from Barnes and Noble, as well as Amazon, or by special order from your local “bricks and mortar” bookstore.  The Greater Reset is the only book of which we’re aware on “the Great Reset” that presents an alternative instead of simply warning of the dangers inherent in a proposal that is contrary to natural law.  It describes reality, rather than a Keynesian fantasy world.  Please note that The Greater Reset is NOT a CESJ publication as such, and enquiries about quantity discounts and wholesale orders for resale must be sent to the publisher, Saint Benedict Press, NOT to CESJ.

Economic Personalism Landing Page.  A landing page for CESJ’s latest publication, Economic Personalism: Property, Power and Justice for Every Person, has been created and can be accessed by clicking on this link.  Everyone is encouraged to visit the page and send the link out to their networks.

Economic Personalism.  When you purchase a copy of Economic Personalism: Property, Power and Justice for Every Person, be sure you post a review after you’ve read it.  It is available on both Amazon and Barnes and Noble at the cover price of $10 per copy.  You can also download the free copy in .pdf available from the CESJ website.  If you’d like to order in bulk (i.e., ten or more copies) at the wholesale price, send an email to for details.  CESJ members get a $2 rebate per copy on submission of proof of purchase.  Wholesale case lots of 52 copies are available at $350, plus shipping (whole case lots ONLY).  Prices are in U.S. dollars.

• Sensus Fidelium Videos, Update.  CESJ’s series of videos for Sensus Fidelium are doing very well, with over 155,000 total views.  The latest Sensus Fidelium video is “The Five Levers of Change.”  The video is part of the series on the book, Economic Personalism.  The latest completed series on “the Great Reset” can be found on the “Playlist” for the series.  The previous series of sixteen videos on socialism is available by clicking on the link: “Socialism, Modernism, and the New Age,” along with some book reviews and other selected topics.  For “interfaith” presentations to a Catholic audience they’ve proved to be popular, edging up to 150,000 views to date.  They aren’t really “Just Third Way videos,” but they do incorporate a Just Third Way perspective.  You can access the playlist for the entire series.  The point of the videos is to explain how socialism and socialist assumptions got such a stranglehold on the understanding of the role of the State and thus the interpretation of Catholic social teaching, and even the way non-Catholics and even non-Christians understand the roles of Church, State, and Family, and the human persons place in society.

Those are the happenings for this week, at least those that we know about.  If you have an accomplishment that you think should be listed, send us a note about it at mgreaney [at] cesj [dot] org, and well see that it gets into the next “issue.”  Due to imprudent and intemperate language on the part of some commentators, we removed temptation and disabled comments.