Positive Money: How to Fix the Banking System (and make it less socially harmful)


The privatised creation of money by banks is at the root of debt, poverty, inequality, unaffordable housing. It makes our boom-and-bust economy completely unstable, and is also fueling the environmental and energy crisis.

Positive Money have spent the last couple of years thinking about how to address the biggest flaws in the banking system, and how to stop banks expanding the money supply recklessly. The ideas below are one way to do this. It’s certainly not the only way but Positive Money believe it is one of the best options currently on the table and would be a massive improvement over the banking and monetary system we have today.

Fix the Money System (part 1 of 3)

In this part:
3 key questions:
1. Who should create money? (00:24 min)
…separate the decisions over “How much money” and “What for” (04:02 min)
2. How much money should they create? (06:56 min)
…about inflation (09:20 min)
3. How should they use the money they created? (10:53 min)

Fix the Money System (part 2 of 3)

In this part:
About one of the ways how newly created money could be used – to reduce VAT.
How will new money be distributed to the economy (01:21 min)
How we will reduce the debt burden across the society (02:00 min)
– smooth transition to a healthy level of debt (04:03 min)
– how we could get rid of a lot of unproductive, socially harmful speculation (05:27 min)
This proposal is an update of 1844 Bank Charter Act (Robert Peel) (07:39min)
Lost government revenue to date £2.1 trillion (09:39 min)

Fix the Money System (part 3 of 3)

In this part:
The concerns about the reform proposal:
1. What about the Credit? (00:54 min)
2. We might lose the taxes from banks… the real contribution of banks, and who is really paying the taxes (03:57 min)
3. Wouldn’t the banks just leave? (07:03 min)

Draft legislation of the reform proposal (Bank of England Act)
3 steps:
1. Make banks ask your permission before lending your money (09:27 min)
2. Make them tell us how they’ll use our money (11:01 min)
3. …more here: http://www.positivemoney.org.uk/our-proposals/video/

Benefits of reform (11:29 min):
– no more bailouts
– no more subsidies
– less poverty
– more jobs
– falling debt
– less inequality

A shorter 20 minute video is available:


2 thoughts on “Positive Money: How to Fix the Banking System (and make it less socially harmful)

  1. Pingback: The UK economy: Observations from Mars. | Think Left

  2. Pingback: So, we all use Money …but what is Money? | Think Left

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