11th May 2014

A fresh economic direction

“The New Zealand economy must be set on a fresh course to build a more equal society, and to strengthen the domestic economy” said Stephnie de Ruyter, leader of the Democrats for Social Credit Party.

“Instead of the usual twiddling around the economic fringes on Budget Day next week, the Government must implement the major features of the “Chicago Plan Revisited”, as recommended in the International Monetary Fund (IMF) report of August 2012.

“The Reserve Bank, now responsible for providing less than 3% of our money, should produce more of the economy’s money supply, and the trading banks less.

“The IMF report identifies four major advantages of it doing this:
(1) Much better control of a major source of business cycle fluctuations, sudden increases and contractions of bank credit and of the supply of bank-created money.
(2) Complete elimination of bank runs.
(3) Dramatic reduction of the (net) public debt.
(4) Dramatic reduction of private debt, as money creation no longer requires simultaneous debt creation.

“A Democrats for Social Credit government would initially use this Reserve Bank money to pay for infrastructure development at both central and local body level, thereby boosting employment, reducing inflationary pressures, and increasing New Zealand’s competitiveness.

“The IMF report states: “allowing government to issue money directly at zero interest, rather than borrowing the same money from banks at interest, would lead to a reduction in the interest burden on government finances and lead to a dramatic reduction of (net) government debt”.

“It also says there is “nothing that supports the somewhat confused claim of opponents, that such a system would be highly inflationary”.

“Taxation currently wasted on interest payments on government debt would be freed up for spending on health and education.

“Ratepayers would find their rates bills going down as about 10% of rates currently go to pay interest on council debt of $4.9 billion.

“Improved infrastructure would help make businesses more competitive, bring costs down, improve our environment, and provide jobs."

ENDS

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