Understanding the money system and understanding the changes needed

Again and again I'm surprised about how little people care about the money system. Money is something so essential and central to our civilisation, yet almost nobody ever makes the effort to find out how it really works. When talking about the money system, I don't mean to talk about budgeting or investments or what we use money for. Of course money can be used for good, and often is. What I mean is the understanding of the money system as the central engine of our economy.

Money is (mostly) created by private banks, typing some figures into a computer, for their own profit. It seems to be natural that when we buy a house we pay the bank about twice as much money than we pay to the previous owner the house. I repeat, when we get a mortgage, then we pay about one third of the money to the previous owner, and two thirds to the bank, for their pleasure to create the money (the means of exchange) for us to make the purchase. In other words, the cost of obtaining the means of exchange to buy a house is twice the value of the house itself. A similar ratio of interest cost is by the way contained in almost any price we pay, for any goods or services.

To me this is wrong - actually it is outrageous, yet people normally don't seem to mind. Strange! It is as if the money system itself is in a blind angle, an invisible spot. Money, as it is practiced today (loaned into existence by private banks with interest for private gain), is not something God-given we cannot change. On the contrary, it is something historically recent, and it is the mechanism that forces our economy into a spiral of never-ending exponential growth on a limited planet.

I believe that we need to wake up to the nature of our money system before we will ever be able to successfully change the way we deal with stuff like climate change and peak oil. Even social issues like poverty can ultimately only be addressed when we change the way how we bring new money into existence. The key ingredient that needs our attention is the interest that is charged at the point of money creation. Money should be created and made available to all participants of the economy for free and for the common good, by either a public institution or a variety of community organisations. Banks and Credit Unions have their role, and should limit their activities to payments, savings and investment activities. (see JAK bank)

How will we achieve that? First we need to be able to create a means of exchange that is cheaper than money. This can be more than one currency - local, regional, national, global and even sectoral. Then we need to convince politicians to change the legal tender laws in a way that abolishes the monopoly of one kind of currency only (and guarantees a certain income to a small handful of corporations (banks). There should be a number of currencies that are legal tender in any country.

To conclude, this is what we need:
- a means of exchange (money system) that is run for the common good and that is free (as cheap as possible)
- an overhaul of the legal tender laws, in order for several currencies to be recognised as legal tender