Introduction to Money; A Mirror Image of the Economy

This is a chapter from the book, Money; A Mirror Image Of The Economy. Visit that link for more information about the book.

Pulling this research together alerted us that roughly 60% of America’s huge blocs of capital were little more than capitalized values of unearned wealth and elimination of those monopoly values would double economic efficiency permitting each to live a quality life while reducing working hours by half.

This led us to another realization: Most economic classics are not philosophical works on efficient economies. They are instead justifications for a property rights system put in place by powerbrokers over the past 700-plus years. Though it is getting more difficult every day, major classics and their descendents are still justifying their inefficient and inequitable “property rights laws.” As those laws are the heart of the monopoly system, and thus the heart of the problem, any philosophy which does not challenge those fundamental laws cannot possibly be a guideline for full and equal rights for all.

Learning that most accumulations of wealth are unearned would be a shock to most of us. We all feel we work hard for our money. What we don’t realize is that fully half of our labor is ground up and wasted within the superstructures managing, and the military protecting, these monopolies

Egyptians spending their labor and resources building pyramids had nothing on capitalism—properly named monopoly capitalism—whose waste is just as massive. Powerbrokers were able to get away with the fraud, firstly because ever-improving technology was so enormously efficient that all would gain even though the “property rights laws” being established were enormously inefficient; and secondly huge amounts of wealth were being appropriated from the periphery of empire and distributed as honest earnings. The citizenry—working hard every day—were unaware that half their efforts were wasted and also unaware that much of their wealth had been unnecessarily appropriated from other societies.

Quite simply, if any country or federated region successfully gained their freedom, eliminated monopolization within their internal economies, and achieved economic efficiency, as we demonstrate is possible, the impoverished world would notice and the monopolization structure, both internally and in world trade, would collapse.

The legal structure of a non-monopolized capitalist economy is very simple—full and equal rights for all through conditional titles, or as a human right, to nature’s resources and technologies. Under those “property rights laws,” conceived by Henry George over a century ago, the massive blocs of monopolized capital, previously buying and selling capitalized appropriated values, are transposed into equally-shared use-values.

We are taught that these huge blocs of capital were crucial to economic efficiency. Not so. Socially-owned banks under social control fulfill any need for finance capital by creating essentially debt-free money for social infrastructure, including first industries. Under full and equal rights, each would have their proper share of both created and circulating money providing a quality life, and, once a society is industrialized, all this while working only two to three days per week outside the home.


Environmentalists and all concerned with global warming will be interested in the huge levels of economic waste, 50% per unit of production, which can be eliminated under Henry Georges’s philosophy for a quality life for each citizen of this world. ——–The author

As products and services are paid for with money, its flow—as the mirror image of an economy—is easily understood. It is accepted as a given that a nation’s banking system collapses when a nation’s economy crashes. This is only true of “private” banking which takes care of private interests whereas a socially-owned banking system, properly structured and operated, would stay open taking care of both public and private interests.

When an economy is booming, a private banking system appears to operate smoothly and efficiently. But, at some level, it is understood that private bankers, caring for their private interests, corrupt the economy; this, in turn, creates poverty and economic collapses. What is not understood is that a socially-owned banking system, caring for the needs of all, would have (measured in steadily advancing qualities of life) would have created a more robust economy than private banking in its best years; it would also have been structured and handled in the interest of each citizen, without the threat of economic collapse.

More importantly, an economic crash under private banking can be stopped in its tracks and the economy quickly rebuilt by restructuring to a socially-owned banking system and utilizing its inherent powers. Those powers are denied society under private banking because the bankers are caring for their interests and that of powerbrokers, not that of the citizenry as a whole.

Henry George was the economic philosopher who gave us the analysis to understand that. Before they go on to their final reward, most economists of high standing will say “Henry George had it right.” What he had right was that no one produced natural resources, it was produced by nature; hence all are entitled to their share of the wealth produced and that can be efficiently accomplished through social collection of land (resource) rents.

His philosophy of social collection of resource rents converts exclusive title to nature’s wealth to conditional title. Those resources were produced by nature, not by anyone’s labor. Thus the wealth it produces is properly shared by all and social collection of resource rents building infrastructure, operating governments, and caring for other social needs accomplishes that goal.

His philosophy required converting exclusive titles to nature’s resources with its private capture of land rent to conditional titles with society collecting the rental values. Through social collection of resource rents, its expenditure on infrastructure and other social needs, all other taxes eliminated, and the initial cost of land now being zero making ownership easy, none of which occurs under the current monopoly system, each citizen receives their share of nature’s wealth. As rental values are only slightly lower than payments on purchase of land, the annual cost of owning land appears to drop only slightly. But with no initial costs and the elimination of taxes, with those rental values being spent on water systems, sewers, roads, communication systems, railroads, ports, airports, post offices, other natural monopolies, and other social needs, all citizens are triply repaid for paying those rental values to society.

Land titles first issued by governments as “patents” acknowledges patented mechanical and chemical technologies as being a part of nature. They are, like natural resources, waiting to be discovered. By applying Henry George’s principles of social collection of natural resource rents, and rights of all citizenry to their share—in this case paying inventors well and placing all technology in the public domain—the wealth produced by technology is equally shared through at least a 50% drop in the price of consumer products.

Georgists recognize taxi medallions (licenses in New York City, having a capitalized rental value of $200,000) as a monopoly identical to land monopolization. Land has unearned capitalized rental value and so do taxi medallions. The connection between them, as studied by Georgist Ole Lefmann, is that their values were not produced by labor but by exclusive titles (monopolization) which gives them rental values. Like taxi medallions, banking, insurance, law and health care are all technologies, a part of nature which must be discovered and refined over time, licensed within a monopoly system, and that legal structure gives them monopoly rental values. Land has tangible value but it is produced by nature. Banking and insurance are social technologies and their licenses within a monopoly system give them monopoly values. There are no tangible values produced by labor. Healthcare and law have tangible labor values (years of study) but their market prices are primarily monopoly values created by license as well as the values created by labor. Patents have some tangible labor values, but the much greater monopoly values double, or possibly triple, the cost of production. Possibly 80% of that overcharge is wasted overseeing these monopolies and possibly 20% is banked as monopoly profits.

Licenses per se do not have monopoly value; they are a necessity and are proper. It is the ad hoc expansion of the monopoly system within which they were issued. Licenses are issued within other social structures without developing monopoly values. The ad hoc manner in which the superstructure operating these social technologies formed led to enormous labor and resource costs which were factored in as normal. Those technologies are well understood today and that same unnecessary and wasted labor is now battling for market share for what is now recognized as a necessity and thus should be a social or human right. Converting marketing rights to banking, health care, insurance, etc, for a few to a social or human right for all would eliminate battles for market share and drop costs by roughly half. The resulting full and equal rights eliminating most legal battles are part of the cost savings.a

Monopoly Capitalism’s Property Rights Law Versus Henry George’s Property Rights Law

Money is a social technology discovered over 5,000 years ago. Banking is an extension of money technology learned over the centuries. By restructuring private banking to a socially-owned banking system, one has applied Henry George’s principle that, as such technologies are only a part of nature waiting to be discovered and have few or no tangible values produced by labor, each citizen has a right to their proper share of the wealth produced.

Over the centuries, to protect and increase their wealth and power, powerbrokers have extended the principle of monopolization of land through exclusive titles to include banking, patents, communications, insurance, health care, the legal system interpreting those rights for us, and other more minor sectors of the economy (run an Internet search for “rent seeking”). To both protect their system of wealth appropriation and lay claim to even more wealth. This system of unequal rights, privatization of every last aspect of nature’s wealth and technologies, is being imposed upon the rest of the world.

Propaganda as to the high efficiency of an economy operating at half its potential is not only hiding inequalities, violence, and lack of democracy, it is hiding the fact that monopoly capitalism’s fundamental property rights evolved from aristocratic law, those exclusive titles to nature’s wealth and technologies, which were designed from their earliest beginnings to appropriate the wealth of the politically weak. Each having the possibility to gain those exclusive titles gives the appearance of equality. But superior rights is a contradiction in terms. Some will win, some will lose, and the structure of a wealthy few and impoverished many stay firmly in place. This reality is hidden by the immense wealth stolen from the rest of the world through plunder by trade. If the developing world allies together and demands equality in trade, Europe and America would immediately lose possibly half the wealth annually distributed among their citizenry and the demographics would quickly shrink to the aristocratic structure from which Western Capitalism supposedly evolved. The original aristocratic structure, exclusive title to nature’s resources and technologies, is still there hiding under beautiful names such as democracy, capitalism, etc.

Aristocracy fought for centuries to acquire, extend, and retain their superior rights and a large share of violence and wars today is financial aristocracy, just as aristocrats from which this legal structure evolved, battling to acquire, extend, and retain the same exclusive titles to nature’s resources and technologies, in only slightly adjusted form, as under aristocratic law. Battles against those unequal rights are the primary struggles throughout the world today.

How is it possible to have “free thought,” “free thinking universities,” and a “free press” and not be aware of this process? Think of the centuries the common people were trained to look up to and worship aristocracy. As they were the only ones who could read and write, the first books can only have supported them. When education spread to the common people, literature still had to glorify aristocrats. For powerless people to have attacked them in books in any way would have led to very unpleasant consequences.

This system of control was retained as the bourgeoisie gained rights and power. The common people were never anticipated to have rights and their masters had disciplinary power. Thus the classics supporting the unequal property rights law being put in place were pushed while none attacking the system being permitted amounted to firm control of what was taught. For a century or two, there was nothing else out there and serious alternative views challenging the system are not permitted yet today. Aristocratic property rights hiding within current property rights laws were taught as maximally efficient, while all others were, except on the margins, taught as dictatorial and inefficient.

Marx’s philosophy is one such belief system on the margins which gained traction and large numbers of followers. Powerbrokers spent trillions of dollars, slaughtered tens of millions, spent billions on propaganda—through funding authors and their books, through the media, and in the universities—to relegate that philosophy back to the margins. Marx is now marginalized and that control process is still with us today. Classics and derivative works supporting the system were taught as the only viable philosophies and simultaneously it was taught that all were free to think as they wish and encouraged to do so. But those who did were immediately ostracized to the margins, just as all challenging thought had been for centuries, and that scene is replayed over and over. Those marginalized understand it. Due to continued massive propaganda such people are believed to be a threat to their freedoms and rights, that they are radicals not to be listened to, or whatever. Meet any mainstream professor today and you will find them totally sincere, wanting to do good, and unaware that their thoughts are as firmly under control as those of scholars 500 years ago.

Note the complexity of classical and neoliberal economics. Note the simplicity of eliminating poverty and providing a quality life for all as we will be outlining. Note its solid logic and note the certainty that it would be rejected by those mentally locked within the “system.” However, when circumstances are right, that control (propaganda) will be thrown aside and one who parrots the old beliefs will be hard to find.b The waste and violence of the current system is so enormous—fully as much wasted, destroyed, and production forgone as that consumed—we must hope that day will be soon.

Citizens within what are touted as full democracies, but in reality are only representative democracies, are subject to laws decided upon by others, primarily corporate lobbyists whose bosses claim far more than their fair share.

For each to attain their rightful share of nature’s wealth, full and equal rights for each citizen should be enshrined in a constitution. The justice of those rights will be evident as each produce and consume their fair share. The essentials of such a constitution are laced throughout this treatise.

Once such a foundation is in place, laws covering disputes and changing circumstances can be decided upon by either participatory or direct democracy as opposed to today’s representative democracies. Such laws voted on by a citizenry, as referendums are now approved or disapproved, utilizing eye or thumbprint scans to assure honesty, is very viable. With direct citizen approval of important laws and constitutional changes, and though not perfect, Cuba and possibly Libya are the only such democracies today.

As opposed to a full democracy, the laws Western nations are subject to are the unequal property rights designed by their predecessors over the past 700-plus years, generally addressed as “property rights law.” They are not a system of property rights based upon equality and social justice. Even though it is an unequal property rights system, individuals can make decisions and society within the imperial centers can, due to the enormous efficiencies of ever advancing technology, rapidly develop. Those pointing out current property rights laws permit stability and the enormous wealth in Western cultures do not realize this legal structure is denying the full development of both internal and periphery economies. All societies, including those imperial centers of capital, could advance much faster and more equally if those laws were designed for full and equal rights. Sector by economic sector we will be explaining how applying the principle of full and equal rights to nature’s wealth and technologies will eliminate the inequality of today’s property rights laws.

Through the greater share of those 700-plus years, little consideration was given to the rights of the common person. Laws were written by the powerful for protection of their wealth and power and for attaining more wealth and power. Thus the extension of exclusive titles to land under the enclosure of the commons process, which started formally in England under the Statute of Merton of 1235, created massive wealth for the powerful few and colossal poverty for the many. See chapter one of The Earth Belongs to Everyone, 2008, by Alanna Hartzok. She goes deeply into the early privatization of the commons as a system of theft of wealth properly belonging to all.c Those early enclosures of the commons and the ongoing privatizations today are the fundamental property rights laws governing monopolization.

Aristocrats created those first monopoly laws and the very principle of aristocracy was exclusive title to nature’s wealth, those huge blocs of land they controlled. Those exclusive titles, enclosing the commons, were only aristocratic privileges (monopolization) inserted into modern law.

Property rights laws being established dealt with rights but only in the sense of superior and inferior rights. As the masses slowly gained more rights, they were given the opportunity to purchase land (resources). Quietly and slowly these “property rights laws” spread in step with the increased wealth produced by ever-increasing efficiencies of technology. The elite, with their excessive rights—they were the only ones educated, held all the positions of power, and they created all the laws. They poured out philosophies of high economic efficiency under the property rights laws as structured, exclusive title to nature’s resources and technologies, and we hear that claim repeated in almost every classroom today. In later laws, those superior rights were continually extended.

Those superior rights, assured by exclusive titles to nature’s wealth, had a hidden secret: aristocracy proper was to largely disappear but the principles of aristocracy, still protecting wealth and power, lived on in those exclusive titles to nature’s resources and technologies. At that time, it could not have been anticipated that the common people would ever own a part of the earth upon which they lived and worked. When the bourgeoisie, and later the common people were brought into the flow of money to purchase land, the fortunate now had, once that purchase was paid for, a share of the superior rights once held by aristocracy. This book exposes that hidden secret, exclusive title to nature’s resources and technologies is the very foundation of today’s monopoly system being imposed upon the world. By giving each a chance—in reality some a good chance, some a small chance, and most no chance of gaining clear title—the system is, like every game of chance, very seductive.

Let’s examine that secret in greater depth. If you were accosted and robbed, that is obviously a criminal act violating the rule of law. If your legislature passed a law giving an advantage to a group or an individual which enabled them to appropriate unearned income, it happens all the time (run a search for rent seeking) that would be within the rule of law but would be easily recognized as creating inequality through granting excess rights to a fortunate few.d

The British Enclosure Acts addressed above, assigning exclusive land titles to lords of the land and forcing the serfs into the city to survive in breadlines, is easily analyzed as property rights law giving excessive rights to a few and taking away rights and wealth from the many. That injustice was justified by philosophical treatises, known today as classics, stating that those unemployed workers were necessary to work in the factories at the start of the Industrial Revolution.

This is a clear example of the need to philosophically justify inequality structured into property rights law. Today we know every factory ever built in either a poor country or a rich country is always overwhelmed by applications for employment. The reason is obvious; those employed can purchase more of the amenities of life. As labor has always been available in long-established, heavily-populated societies, the need to dispossess people from the land to create a labor force was only a justification, not an honest philosophical analysis.

With continued philosophical justification, the major classics, the masses’ rights to the commons were forgotten and exclusive title to nature’s resources and technologies for financial aristocrats was accepted as normal. We hear those justifications yet today; “this is the most efficient economic system.” Even when its imperfections are recognized it is still justified: “this is a really a bad system except it is better than all others.” Through demonstrating the enormous efficiency of a modern commons under Henry George’s philosophy, a classic that spotted the inequities in Western property rights laws, we prove such alibis have no relevance to reality.

What those rationalizations were hiding was the systematic theft of other people’s wealth through unequal property rights laws. Those evicted from the commons knew they were losing rights and the landlords were gaining rights. But, just as today, the only voices heard were those justifying that theft. Over time, former rights were forgotten and current property rights laws were accepted as normal.

An attempt was made to establish aristocratic law in America. But the expanse of land was so vast that those intended as serfs simply squatted on “empty” land, that is empty after genocidal slaughters of the natives, claimed it, and retained 100% of what they produced as opposed to half or less that a serf would retain. At that time, and as the Industrial Revolution was forming, the American Revolution gave more rights to the common person, primarily in the same form as aristocracy, exclusive title to nature’s resources and technologies. Through the French Revolution, other crises, and with the new freedoms and rights in America blowing back onto Europe, the suppressed serfs of that continent also attained more rights.

Over time, the theft of wealth throughout the colonial world, and a need for a loyal citizenry to provide the military to enforce that piracy, permitted (dictated) a further sharing of wealth with internal labor, see this author’s simultaneously released Economic Democracy: A Grand Strategy for World Peace and Prosperity, 2nd edition.

With wealthy citizens throughout Western Europe and America, the acquisition of wealth beyond anyone’s dreams only three generations ago is taught as justification for what is obviously a profoundly unequal and unjust system. But the above noted source and this treatise proves monopoly capitalism, misnamed capitalism, is inefficient to the extreme. Massive wealth is being appropriated from society’s own labor and from the periphery of empire. Half that wealth is ground up through the offices and staff overseeing those monopolies and in the military forces required to protect what is little more than a racket, US Marine Corp Major General Smedley Butler’s “War is a Racket”;

As addressed in earlier research, Southeast Asia’s industrialization was an accident of history; Western powers were seeking allies in their desperate effort to prevent honest and moral property rights law from emerging to challenge their unequal and unethical legal structure. The Conclusion will address how that accident of history, a highly industrialized Southeast Asia and a stirring of the masses of South America and Africa, will likely overthrow the unequal legal structure the West has spent 700-plus years establishing.

As much of the world now understands the fraud imposed upon them for the past half millennium, those exclusive titles to nature’s wealth, the very essence of monopolization, has the possibility of disappearing into history to be replaced by a peaceful, prosperous, sustainable, federated world with a quality life for all. Contrary to those 700-plus years of justifications, there was never a need for exclusive titles to nature’s bounty to accumulate finance capital. Avoidance of that unequal legal structure, through utilizing Henry George’s mighty economic and financial engines and sharing technology, as opposed to monopolization, would have doubled economic efficiency and eliminated poverty as fast as new technologies were invented.

Exclusive title to nature’s resources and technologies is a system of theft and, as proven by the first 500 years of the struggle against it, was recognized as such when first being imposed. But philosophical justifications, those classics and their derivatives taught in the universities and through the media, have erased that reality from the social mind. To bring up the possibility of such inequality and inefficiency in either polite society, in an academic setting, or in this book, is to create total shock. Such is the totality of the belief systems imposed upon us to hide the reality of a system designed from its origins to lay claim to wealth belonging to others.

Placing Henry George’s principle of restructuring exclusive titles to nature’s resources and technologies to conditional titles, point by point, alongside the property rights laws of other economic philosophies serves as a template to judge whether that philosopher is unwittingly parroting justifications of the current unequal and unjust system or whether he or she has truly produced a philosophical paradigm that would provide full and equal rights to all and eliminate poverty while also conserving our resources and protecting the environment.

Comparing the social and human rights, equality, and economic efficiencies under Henry George’s inclusive property rights law will expose inefficiencies and inequalities which are the result of a long history of injustices within other societies. Example: the caste system, now outlawed in India but still having substantial impact, is a system of rights, entitlements which amounts to property rights law, established centuries ago. Only 160 years ago in America, and in some cultures yet today, slaves and women were property. The principles are the same, superior rights for the few and inferior rights for the many. Excessive rights are easy to spot in such a system and thus easily condemned. The superiority of the Western system of inequality is hidden so deep in custom, in property rights laws, and protected by philosophical justifications, classical and neoliberal, through the educational system and the media, that it is not only considered normal and just, but it is also deemed and taught as essential.

Social scientists must look closely. Currently large parts of the world are accepting Western property rights laws as providing equal rights and maximum economic efficiency. As we will be thoroughly addressing, that is not true. Capitalism’s mighty economic engine and the belief system societies are encased in hide the enormous inefficiencies of that engine and the violence caused by the property rights laws imposed over the past 700-plus years. The first impositions of unequal rights were by violence as the commons were privatized. Major classics then justified the imposition of that system of theft. Later impositions of the belief in the justice of such thefts of others’ wealth were through the university systems teaching those classics. The belief system was so total that professors were unaware those philosophies were only justifying a system of theft imposed for centuries and that process is ongoing yet today. One of the assumptions of this book is that, in their struggle for full and equal rights, a large share of the world is breaking out from under the belief systems protecting Western culture’s unequal property rights laws.

Henry George pointed the way out from under this system of theft. Production of wealth is, at every turn, a utilization and transformation of nature’s wealth. This treatise addresses how restructuring property rights in land, technologies, money, and communications, all technologies of nature, from exclusive titles to conditional titles, society shall collect rent values or it shall be legislated as a social right or a human right, would increase economic efficiency equal to the invention of money, the printing press and electricity. That process would give full and equal rights, economic and political, to everyone.

We are primarily addressing the internal economies of today’s hegemon, America. It is their system of exclusive title to nature’s resources and technologies, creating wealth and power for a few and the impoverishment of many, that is being imposed upon the world.

The proof that Western property rights laws are systems of inequality and inefficiency would be the disappearance of fully 60% of the finance capital within a monopolized economy and the simultaneous rapid increase in real wealth relatively equally shared when one restructures those exclusive titles to resources and technologies to Henry George’s inclusive principles of conditional titles.

That condition: society should collect rental values on all natural resources; in the case of technologies eliminate those monopoly values through paying inventors well and placing their discoveries in the public domain; and, in the case of monopolization through licenses, legislate those crucial services as a social right or a human right. There will then be no need for fully 60% of the huge blocs of capital currently operating the American economy. They appear to be necessary but in reality they are only buying and selling the capitalized values of wealth appropriated through exclusive titles to nature’s resources and technologies. Under full and equal rights, those capitalized values transform into relatively equally shared use values. Any shortage of savings (capital) within a socially-owned banking system is alleviated by simply printing it.

Appropriations of wealth through exclusive titles, no matter where or how they are invested, engender a continual appropriation of more wealth. The owners of those unearned funds, searching for a safe place to invest, typically settle for buying treasuries issued to cover the costs of the federal government or bonds to build schools, sewers, water systems and other crucial infrastructure. Citizens, from whom that wealth was appropriated in the first place, pay taxes to pay off that principal and interest. As those debt instruments are paid off, that money is reinvested. The same citizenry, through either taxes or the purchase of products and services at excessively high prices, again pay off those debts. And that impoverishing cycle goes on in perpetuity interrupted only by economic collapses due to too much wealth in the hands of the few and too little buying power in the hands of the many.

It is the potential of doubling or tripling economic efficiency through conditional titles to nature’s resources and technologies and eliminating all appropriation of others’ rightful wealth which tags those continual repayments of appropriated wealth as “impoverishing cycles.” Those inefficiencies under the founding principles of major classical economics alert us they were only justifying a system of excessive rights; they were not laying out principles of an efficient economy. Those justifications, trying to rationalize property rights laws within classical and neoliberal principles, are pouring out yet today.

Just as customs of ancient cultures are huge obstacles for their societies to evolve efficiently, residues of exclusive feudal property rights in Western cultures severely restrict the potential efficiency of capitalism. Those inefficiencies are not perceived because modern technologies are so efficient that the huge gains are visible and admired while the even greater gains possible under inclusive property rights remain unknown. This work is an attempt to bring those potential gains out into the open for all to see and they then restructure their laws and economies to gain the benefits of Henry George’s inclusive property rights laws. It is that recognition of economic efficiency and full and equal rights which led respected economists to say Henry George, the philosopher rightfully credited with the clearest presentation of this philosophy, had it right.

The basic principles of monopolization under feudalism were never abandoned. Citizens living within the belief systems of monopoly capitalism have full rights only in the sense that each has a chance at becoming a wealthy monopolist. But only a relatively few can appropriate massive wealth through those residual feudal rights.

These inequalities are not visible to Americans and Europeans because of the large percentage with a high standard of living and thus appearing to have full rights. But, unrealized by the citizenry and most in academia, that high standard of living is only through massive thefts of wealth from the periphery of empire. The powerful today are fighting to retain and expand their monopoly property rights, exclusive title to nature’s resources and technologies, just as feudal powers fought for centuries to maintain their exclusive titles to land which is, of course, the same wealth of nature that is being fought over today.

As the enormous wastes within a banking system cannot be eliminated without elimination of all other monopolies, we will address deeply the four primary monopolies—banking, land, technology, and communication and, with the principles of exclusion and inclusion within property rights law well established—summarize the secondary monopolies, insurance, law, health care, etc. This being primarily a book on money, we will address that first.

Money is a social technology; hence it is a part of nature’s wealth discovered over 5,000 years ago. That a banking system is properly owned by society is demonstrated by outlining the enormous efficiencies of full and equal rights under that banking structure. To keep everything local, each social unit—a federation of nations, each nation, each region within a nation, each state, each community, each business, and each entrepreneur—should have a constitutional right to their share of socially-created money and savings (investment capital). Credit cards approach this ideal for consumer purposes but such full and equal rights have never in the history of private enterprise been applied to investment. The overcharges on those cards disappear when issued by a socially-owned and operated banking system.

The elimination of monopolization does away with the need for those huge blocs of unearned capital, roughly 60% of all finance capital. Contrary to that capital being necessary, its elimination would be a blessing. So long as there are available resources and labor, money can be created, up to the level of a balanced money supply, to build social infrastructure and industrial capital. As social infrastructures—governing structures, roads, railroads, harbors, communication systems, water systems, sewers, etc, any natural monopoly, they are properly owned by society and should be built with primary-created money up to the level of monetary balance. Through adjustments of required reserves—which first require bringing all money systems, including insurance companies, the stock market, and money markets under some sort of fractional reserves— that balance point within an economy between building with socially-created money or savings can be moved across the economic spectrum at will. But that balance point is better maintained by calculating charges for resource rents and banking covering the costs of infrastructure, health care, and, although society may also handle it through payroll deductions, could be extended to retirement

History is replete with creating money for wars. The populists of the late 19th century advocated printing money to loan to farmers. The German and Japanese rapid buildup of industry in the early 20th century was financed with socially-created money. Most money theory is silent on the enormous potential for such money funding infrastructure and crucial social needs. Stephen Zarlenga, in The Lost Science of Money, pp. 665-66, suggests creating money for infrastructure, housing, environmental cleanup, communications, retirement, and universal health care. Not having read all his work, as yet I do not know if he is aware of the necessity to continually increase required reserves to soak up the increased money supply and, at this point in time, I have not seen him address eliminating the huge blocs of capital created by appropriating the rental values of nature’s resources and technologies properly belonging to all. Unless that unearned wealth is addressed, any banking system established must either finance those monopolies or force them to invest elsewhere. Through created money taking over their historic investment markets, massive blocs of appropriated capital and created investment capital will be at war. Although it can be easily and properly done through mandated reserves, funding through calculated resource rents and bank charges just as easily attains the desired money supply balance.

Such primary-created money building infrastructure circulates within communities, regions, nations, and federations to provide the citizenry with food, fiber, and shelter. As industrial capital is justly privately owned, industries are built by savings (financial capital) with any shortages balanced by creating money to loan for such productive purposes and any excess circulating money rebalanced by destroying, by higher mandatory reserves, any surplus that arises.

Balancing an economy under a modern banking commons within an inclusive society with full and equal rights for all would be simplicity itself. Financial capital would then be the total savings of all, balanced by primary-created money to fill any shortfall, or its destruction through higher required reserves to eliminate any surplus. Such full and equal rights would eliminate inflation and deflation and assure a quality life for all, see footnote, p. 30.

Eliminating offices and staff operating those monopolies and the wars generated protecting them eliminates half the economic activity of a monopoly system even as poverty disappears. Those exclusive titles to nature’s wealth, primary monopolies, and those secondary monopolies structured under those property rights laws, typically by license, are consuming over half the financial capital flowing through America’s current banking system. Those wasteful flows of money can only be shut off by eliminating all residue of exclusive feudal monopolization, primary monopolies, and modern methods of monopolization, secondary monopolies, firmly entrenched within Western economies.

Societies do not transform incrementally, necessary change occurs in revolutionary leaps. The appearances of current changes are only potentials. The actuality is the poor of both the wealthy economies and the less developed world are getting poorer as the rich get richer and only under extreme crisis will the rights of the politically weak be considered.

The necessary restructuring can only happen when the current system collapses. As it has always done so before, it will do so again. When it does we must be ready to provide the philosophical foundation for restructuring unearned values, currently capitalized into massive blocs of unearned capital, into roughly equally-shareduse values.

Those efficient economic principles should be applied to the developing world. The infrastructure necessary for them to be efficient appears expensive. But that is only true if built by outside contractors. All costs above resource rent values are labor costs and we thoroughly document that most resources are within their borders and such rents properly go into the social fund. Machinery and infrastructure built by a federated region’s own companies and trained labor creates wealth equal to the price of that labor, which is their own, interest on industrial capital is payment for use of stored labor and those factories should be built with local labor and resource rents coming from their regional resources. As labor spends their wages for their living and governments spend resource rent and banking profits to run governments and essential services, all those values, except that spent for imports which, when resources and technologies are equally shared, will be minor, are a region’s circulating buying power.

Train labor, build industries to scale for a federated region, build construction equipment with those industries, build that infrastructure, and the cost to a region is primarily the cost of importing modern tools for those factories.

The undeveloped regions have most the world’s natural resources and all manufactured wealth is processed from natural wealth. So, although it is necessary that the banking system be socially owned, developing an economically viable region is primarily creating money to train and employ a region’s labor force to build the necessary infrastructure and their currency must have no value outside their borders, a world dual currency system.e That infrastructure and the wealth produced backs both the newly-created and circulating money and surplus money is easily destroyed by increasing mandated reserves. The circulation of money producing and consuming within the borders of an economically viable region is the economic multiplier of a prosperous community. Current exclusive titles to nature’s resources and technologies, and the many other monopolies copied after those original excessive rights structured within property rights laws, denies that simplicity to the world.

That the world will abandon its current struggles over who will control resources and the wealth producing process and peacefully and rapidly eliminate poverty, we describe in depth it can be done, is not likely. But such revolutionary leaps have happened before and modern communications and the current disastrous foreign policy of America, the hegemon currently blocking such changes, has cost them the moral high ground and greatly increased, and may have assured, the potential of another such leap.

Our concluding chapter is a theoretical example of restructuring a collapsed capitalist economy, the world breaking free and then rapidly developing, both using Henry George’s mighty economic and financial engines. As a banking system has to fund them, leaving monopoly property rights laws in place while creating a theory of either money or economics is an exercise in self delusion.

The theoretical elimination of these monopolies brought to light many deep secrets of money. For example: fully 60% of America’s huge blocs of capital is unearned wealth reducing economic efficiency by at least 50%; that many economic classics are only justifications for an unequal system of property rights identical to ancient aristocratic rights; that inflations are conscious decisions; that money can be created for any crucial purpose and yet the money supply kept stable by calculated increases in required reserves; that the patent system is central to denying the rest of the world their freedom and rights; and that a currency valid only within a newly federated region permits money creation for both infrastructure and industry are only some of those secrets.

The chance that the world will peacefully eliminate the monopoly system, aristocratic law hiding under Western property rights laws, imposed upon the world as per this thesis is unlikely. But eliminating those monopolies would be revolutionary and the only way to address those many obstacles to peace and prosperity was to assume a revolution in progress. So, the improbabilities aside, it is one of the possibilities, we address it that way, and from our vantage point it appears a worldwide populist revolution is on as we speak.

That modern communications will revolutionize the world is well understood. That a worldwide populist revolution is in progress is recognized by many. We hope to alert these same people that Western property rights laws were designed from their origins as a system of appropriating wealth produced by others; that the capitalized value of these annually claimed unearned values is capitalism’s mighty engine which wastes or forgoes production of half the wealth potential; and that the much smaller, yet twice as powerful, economic engine under Henry-George-capitalism would eliminate that waste, would eliminate wars, would eliminate poverty, and could provide a quality life for all within 50 years.

A maximally efficient economy with full and equal rights will have elements of capitalist, socialist, and communitarian principles within it. The inclusive property rights laws of Henry George blend the essential principles of all three and adds one more, society should collect land and other resource rents. Though crucial elements of other philosophies are involved, expanding the principle of society collectively laying claim to wealth offered by nature to all for free tags this work as an expansion of Henry George’s thesis.f

We searched for other monetary theories that could be tied into this theory, but none challenged the unequal property rights laws carefully put in place the past 700-plus years. Those unequal property rights, accepting monopolists appropriating value (wealth) produced by others, form the centerpiece of Western capitalism’s monopoly system.

This latest research exposes the classical economists as justifying a system of theft, evolving directly out of aristocratic law, which severely cripples the potential efficiency of an economy as opposed to producing honest philosophy producing the maximum good for the greatest number of people.

Twentieth century neoliberal economics has been exposed and discredited. Classical economics were the neoliberal economics of centuries ago which, because a serious exposure of the inequalities and injustices would have led to being ostracized or to even more serious consequences, primarily only socially-safe belief systems were discussed.

Ole Lefmann, a Georgist scholar for 65 years, alerted us that Henry George envisioned all we address in this book over a century ago. He spoke of

the need to restore to all their natural and equal rights in the common heritage. … That all men have equal rights to use and enjoyment of the elements provided by nature. … That each man has an exclusive right to the use and enjoyment of what is produced by his own labor. … To secure fully the individual right of property in the produce of labor we must treat the elements of nature as common property. If any one could claim the sunlight as his property and could compel me to pay him for the agency of the sun in the growth of crops I had planted, it would necessarily lessen my right of property in the produce of my labor. And conversely, where everyone is secured with the full right of property in the produce of his labor, no one can have any right of property in what they did not produce. … There is in reality no conflict between labor and capital; the true conflict is between labor and monopoly. … Abolish the monopoly that forbids men to employ themselves and capital could not possibly oppress labor. … [R]emove the cause of that injustice which deprives the laborer of the capital his toil creates, and the sharp distinction between capitalist and laborer would, in fact, cease to exist.1

In the above, Henry George has summarized everything we have to say in this book, in Progress and Poverty he used the term “exclusive titles” to land at least once, thus we give him full credit throughout. A study of his writings reveals his understanding that monopolies separate from land were emerging and that they also had to be eliminated. He also recognized that natural monopolies such as railroads, telegraph, and gas to heat communities should not be privately owned. He pointed out the need for government creation of money 27 years before it became law in America. He pointed out that, “If we ever again have a foreign war it will be of our own making” and we address in depth that vision being today’s reality. And he foresaw that peace and prosperity would require world federation, a principle central to our story.2

Henry George’s visions and his answers proved, to our satisfaction, to be the answer to most the world’s economic problems today and we thank him for those insights and that guidance.

Henry George’s philosophy, the elimination of appropriation of wealth through exclusive titles to nature’s resources and technologies, creates a totally new framework for monetary theory. Those huge blocs of capital, created through capitalizing annually appropriated values, power the famous engine of capitalism which—due to the appearance of enormous successes because the waste, losses, and forgone productions were unknown thus uncalculated—becomes the justification for expansion of the Western property rights system and thus the further confiscation of wealth produced by others. Henry George’s economic engine is half the size, twice as powerful, permits all to retain the wealth they produce, and operates flawlessly as it expands across the world. By contrast, monopoly capitalism’s mighty engine invariably operates at half an economies’ potential, unnecessarily appropriates wealth produced by others, claims too large a share in the process which unbalances the economy, and it flounders and collapses.

Several concepts within this book will be difficult to find in other literature: 1) Even though Henry George saw later monopolies forming, this may be the first time Henry George’s thesis was moved across the full economic spectrum. 2) Others spotted the enormous waste within capitalism but few, only socialists and Marxists, recognized the cause was unequal property rights laws. 3) America’s huge blocs of finance capital are not efficient. Applying the principles of Henry George to each sector of the economy prove that which was unearned, 60% of all finance capital, is reducing economic efficiency by fully 50%. 4) Many recognize much of the ethereal world of high finance as an endless number of schemes for appropriating more unearned wealth. Once the principles of Henry George are applied, that ethereal world is replaced by full and equal rights to savings and created money (finance capital). With money pointed towards the real world, production and consumption, the ethereal world of high finance, wasting enormous resources, disappears. Living standards rise even as GNP falls. 5) Many suggest inventors be paid well and their inventions placed in the public domain. But few realize those monopoly profits are collected through the stock market which would shrink by fully 85% and lower consumer prices by 50%, possibly 75%, if patent monopolies were eliminated. 6) A substantial number recognize society should spend created money into existence building economic infrastructure. (Monetary balance requires only the initial use of created money) But nowhere have I seen these same philosophers realizing the banking system they envision cannot function without first eliminating the monopoly structure. 7) Few of these same philosophers realize that their insistence on doing away with the Federal Reserve would eliminate the only tool that can efficiently control the money supply. Unwittingly they are supporting corrupt bankers in their struggle to permanently eliminate fractional reserve banking and mandated reserves.

That tool, mandated reserves, is the very principle of fractional reserve banking. Double the money supply through massive creation and spending of money, simultaneously double mandated reserves, and the money supply remains the same, see chapter one. Such inroads on prerogatives are a serious threat to bankers’ appropriation of others’ wealth. 8) The inefficiency of the privatized commons doubles consumer costs. 9) The complexities of economics disappear once all have full and equal rights under the principles of Henry George’s philosophy. Most of what passes for economics are nothing more than justifications for current property rights law, a system of theft.

To understand this story I am about to tell, visualize a thousand pilgrims settling a resource-rich uninhabited island establishing their property rights law. As nature offered those rich resources to all for free, obviously each should have an equal share of the fruits of that natural wealth. Yet if they established current Western property rights law only a few would own vast tracts of land and all others must pay those “owners” a rental value from which those few would accumulate huge amounts of capital (wealth). However, if they established the property rights laws of America’s premier economic philosopher Henry George, those resources would be privately owned and managed but society would collect those rental values and use them to build roads, railroads, an education system, water systems, sewer systems, etc, all natural monopolies, to eliminate all other taxes and to give all access to land through its initial cost dropping to zero even as its use value increases.

In the example of Western property rights law, you will have a few massively wealthy, a sizeable middle class, and a large impoverished class. In the Henry George philosophical example, and assuming other amenities of full and equal rights such as equal pay for equally-productive labor and a sharing of productive jobs, those fruits of nature will be equally shared and there will be no poverty, even though the flow of money may be half as much, or even less, as within a monopolized economy.

There are common threads in these monopolies that we are taught do not exist: 1) The foundation of each monopoly is in property rights law—exclusive titles forcing others to pay rental values, overpay for services, or both, for what nature offers to all for free. 2) The elimination of each monopoly has converted either a rent collecting right or a marketing right for a few into a social right or a human right for all. 3) As each monopoly is eliminated, the huge blocs of capital buying and selling those capitalized appropriated values (roughly 60% of America’s finance capital) are transposed into equally shared use values, typically dropping costs by half even as labor time to produce and distribute the amenities of life also drops by half. 4) The ethereal world of high finance, a key aspect of the wealth appropriation process, disappears.

The only intellectually valid challenge will be one recognizing these monopolies and addressing their elimination. We start with the first of the four primary monopolies that must be eliminated, money and banking.


  1. We use the term full and equal rights throughout this book. This entire story could be put together as reclaiming currently denied rights and human rights. Back to text
  2. During the Vietnam War, except for those “radicals” protesting publicly, those against that war were hard to find. When those protestors proved their point and shut down that war, everyone I talked to firmly let me know they were always against that war. Back to text
  3. Alanna Hartzok is Co-Director of Earth Rights Institute. She is currently directing a 34 member International Advisory Group which is developing a program on land value capture (Henry George’s philosophy) for the UN Habitat’s newly-launched Global Land Tool Network. See Back to text
  4. Every law that lays claim to wealth beyond the value of labor expended is an extension of the principle of aristocracy’s exclusive title to nature’s wealth and technologies established over the past 700-plus years as modern property rights law. Back to text
  5. Michael Hudson, the most knowledgeable authority on money I know, and for whom I have the highest respect says, “The Euro cannot fully operate as a reserve currency because the European Union does not have the power to tax.” But a properly structured fractional reserve banking system creating money for infrastructure and essential services and controlling the money supply of a productive economy through increasing or decreasing mandated reserves establishes a reserve currency much more efficiently than the power to tax. Back to text
  6. We highly recommend studying Prout (Progressive Utilization Theory), To attain full and equal rights for each and every person, they too blend the best principles of various philosophies. Through cooperative principles, they too will have philosophically eliminated many, if not most, of these monopolies. We trust they will recognize that applying Henry George’s principles across the full economic spectrum to their cooperative principles will eliminate the last traces of monopolization. Back to text


  1. Henry George, Protection or Free Trade (New York Schalkenbach Foundation, 1992), pp. 278, 280, .286-89, 304-09, 322, 328, and 331 Back to text
  2. Ibid Back to text
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This is a chapter from the book, Money; A Mirror Image Of The Economy. Visit that link for more information about the book.