Recommending the book Diagrams & Dollars

I recently read a book I recommend.


Although this short book is little more than an essay, it rocked my world, turned my thinking upside down, and caused me to question several basic economic assumptions I have held for a long time.

Could student loans be offered interest free? Can the national debt grow without limits or consequences? Can we eliminate taxes? Can the Federal Government readily provide each of us with a generous citizen’s dividend? Could we end poverty with a few pen strokes? Is this all too good to be true?

Enjoy an hour reading this short, clearly written, and thought provoking Introduction to Modern Money Theory and decide for yourself if there is any hope for the ideas it presents.


The Story of Debt

As long as we continue to create money as interest bearing debt, we have little choice but to accept bankruptcy as inevitable, or continue to grow the economy without limit.


Many of the grand challenges we face today are symptoms of this underlying cause. Enough people need to understand this to allow our politicians to speak out against economic growth.

How can we make this message more understandable and actionable?

Ordinal Language may undermine climate change deniers’ efforts.

While 97% of climate scientists concur on the causes and dangers of climate change, merely mentioning “uncertainty” often allow deniers to rally their following. Recent research suggests that using language that links increased risk to uncertainty can help orient people to the real dangers of climate change.


The Cost of Violence Containment

The Institute for Economics and Peace has published a recent report “The Cost of Violence Containment.”  After defining violence containment spending as “economic activity related to the consequences or prevention of violence where the violence is directed against people or property” they calculate the global cost at $9.46 trillion. The report goes on to state: “The old idea of war being good for the economy has been thoroughly debunked and the economic benefits of encouraging peace are increasingly being recognised.”

Share the Fracking Wealth


We must carefully understand and balance the effects of fracking on the economy, society, and the environment for all time.

Thousands of trillions of cubic feet of natural gas that has accumulated over millions of years can now be extracted using recently improved hydraulic fracturing technologies. Heated debates rage in town hall meetings and statehouses as some fight to allow fracking and others fight to ban it.  The debate is often framed as a false choice between jobs and energy independence on one hand, and safety and environmental protection on the other hand.

We can resolve this conflict by agreeing to share the fracking wealth. We can recognize that the natural gas that has been accumulating since life began on earth is owned by all of humanity. We can afford to extract it safely and to share its bounty among the extraction companies, energy users, today’s citizens, and future citizens. The Alaska Permanent Fund and the Law of the Sea can guide us. The “Common heritage of mankind” can inspire us. Closing the Halliburton Loophole and removing other exemptions from federal environmental law can be the first steps in proceeding safely.

Here is the broad outline of a plan. Begin by requiring permits for extracting natural gas. These can be created by the State as “Carbon Certificates” each authorizing extraction of 1,000 cubic feet of natural gas. Designing these to have similar characteristics to Silver Certificates and backing them by the guarantee “in natural gas rights payable on demand” can help us regain some of the security and stability provided by a currency backed by a tangible and valuable asset.

The price of these certificates is set by a citizen-advised agency that works to balance the needs of the economy and the environment now and in the future. Certificates can be resold on the open market. The price could begin at zero for limited time to allow for a smooth transition.

Revenue from the original sale of these certificates goes into a trust fund administered by the State to create a Citizen’s Dividend. These funds are used to:  1) pay a direct dividend to current citizens, 2) offset State budget deficits, reduce taxes, fund environmental conservation, improve government services, and 3) accumulate for the benefit of future State residents. The allocation of funds to these various purposes is directed by a citizen-advised administrator.

Years ago as our nation was being formed Thomas Paine recognized that “Men did not make the earth. It is the value of the improvements only, and not the earth itself, that is individual property. Every proprietor owes to the community a ground rent for the land which he holds.” No doubt Thomas Paine would be pleased to see us sharing the fracking wealth. It is only common sense.

When we decide to share the wealth fracking proceeds safely and the ancient bounty now released by modern technology is shared fairly among citizens for the long term. We all benefit.

An Unlikely Tale

Once upon a time the people of a great land were troubled and deeply divided by two difficult problems. Government throughout the land was nearly deadlocked. The Red team was certain the biggest problem was the growing national deficit. It was presently more than $17 trillion and growing quickly. The Blue team was unconcerned with the national debt and instead was focused on global warming, caused primarily by carbon dioxide emissions. Currently more than 5 billion tonnes of carbon dioxide is emitted into the atmosphere each year by fuels burned in the land. These issues caused a growing rift between the Red and Blue teams as each denied not only the importance, but the very existence of the problem the other team was focused on. The land was sharply divided and people were pessimistic.

Then a wise man suggested a solution. If we agree to sell the right to emit carbon dioxide and use the money to pay down the national debt, perhaps we can solve both problems at the same time.

Protests erupted far and wide. Why do we in this land have to pay for emissions that are dispersed globally and are free in other lands? How will we measure emissions and ensure each emitter is paying their fair share? How can we create such enormous value from almost nothing? Why do I have to pay to solve a problem that I do not even acknowledge exists?

Rare acts of remarkable statesmanship allowed the plan to move forward even as news programs continued to intensify the conflict and controversy. Issues large and small were hotly debated. The plan that was finally agreed to set the price of carbon dioxide emissions at zero for the first three years. This cost increased gradually each year and was set at levels designed to repay the national debt completely over a period of fifty years. Promising results eventually flabbergasted the naysayers. It was working. The deficits and emissions were both decreasing. Other lands followed the example and eventually a carbon dioxide based currency emerged world wide.

They lived happily ever after.

Six moral values, three fairness, and two liberties provide insight

This article Of Freedom and Fairness by Jonathan Haidt clarifies important distinctions that establish six moral values, three forms of fairness, and two forms of liberty. See:

Perhaps understanding these distinctions can help us move from opposition to paradox to insight when we might otherwise get bogged down in polarized debates.

Everybody Wants a Revolution

Hi Folks, I drafted this piece partly prompted by Jeff’s post and Ronnie’s response on the topic of climate change scientists calling for political revolution. I was prompted to publish it this morning after seeing Rob Webb’s response to Russell Brand’s call for “revolution” in British politics.

Hope you find it a useful contribution.
(Read the link to Rob Webb’s piece, even if you don’t read all of mine.)


Scientism has become a fashionable topic recently.

The piece by Steven Pinker in New Republic defending science against charges of scientism, whilst nevertheless implying science had all the answers for non-scientific challenges, prompted lots of reaction.

I happen to agree with Wieseltier here, and relate this blind-spot of science, denying the value of any wisdom beyond GOF scientific empiricism to Nick Maxwell’s “Scientific Neurosis”.

What do you think?
It’s an advance on the tedious science vs religion debate, and maybe a public conversation where we can inject some vital philosophy, bring some values of wisdom to life?