Anti-Bailout Rally at the Fed Building Thursday Afternoon

I also saw an e-mail from the Sheehan campaign quoting a 4pm start time
rather than 5pm. While libertarians will undoubtedly find some of
the "shoot the rich" rhetoric unappealing, the basic demand of the
protest is right on. I'm sure this will be much better attended than
the libertarian/Ron Paul action at the Fed on April 1st. I certainly
plan to stop by for a while and lend my support.

Dear Marc,

Thank you. I will try to be there too


Douglas Rushkoff ( is guest-blogging on BoingBoing
( this week and posted this interesting comment on
Tuesday. I especially like his view that this is not really a "crisis" but
an opportunity to experiment with different forms of commerce, since it is
abundantly clear that the current program has failed. It is high time we
played around with things like "open source economics" to see where they
lead. And yes, several of the comments appended to this post on boingboing
discuss Ron Paul and the Liberty Dollar at length.

Print Your Own Money

Everyone seems to want to know about the economy these days, so we may as
well go there. It's as great an example as any of a program that not only
got out of control, but became so prevalent - so accepted - that we came to
take it for granted. We think of the economy and its rules as given
circumstances, when they are actually constructions.

In brief, the money we use is just one kind of money. Invented in the
Renaissance, and protected with laws banning other kinds of money, it has
very particular biases that lead to almost inevitable outcomes.

I just finished a book (more on that later in the week), where I make the
case that our highly corporatized society was really forged during the
Renaissance. Aristocrats were losing power just as a new merchant class was
gaining it. So they made a series of deals through which merchants'
companies were granted monopoly charters from the monarchs in return for a
sweet cut of the proceeds. Merchants got to lock in their status as newly
rich, while monarchs stopped their own descent. Merchants supported the
monarchs whose charters granted them exclusive access to new territories or
industries, and monarchs got to do colonial expansion once-removed.

The invention of centralized, national currency was meant to support all
this. Where localities had previously been free to mint their own currency
based on the crops they had grown, now they were forced to borrow money from
a central bank. This allowed the issuer of currency - the crown - to extract
value from every transaction. Anyone who wanted to buy anything from anyone
else had to run it through the central authority - coin of the realm - one
way or the other.

This engendered competition for money, which was now a scarce currency
issued at interest, instead of a local currency as abundant as the year's
crop. Moreover, any business wanting to borrow money for equipment or
development had to pay back several times what they had borrowed. This meant
bankruptcy was built into the currency system. If a business borrows
$100,000, for example, they'll have to pay back $300,000 by the time the
loan is due. Where does that money come from? Someone else who borrowed.

Meanwhile, local currencies had the opposite bias of centralized currency.
Local currencies lost value over time. They were really just receipts on the
amount of grain that farmer had brought to the grain store. Since some of
that grain was lost to rats or water, and since the grain store had to be
paid, money devalued each year. This meant the money was biased towards
being spent. That's why reinvestment in infrastructure as a percent of total
revenue was so high in the late Middle Ages. It's why they built those
cathedrals. They were local efforts, by people looking to invest their
abundant wealth into real assets for their communities' future. (Cathedrals
were built to attract pilgrims and tourism.)

Unlike local currencies, centralized currencies were biased towards
retaining their value over time. Capitalism (in addition to being a lot of
other things) is the way people get rich simply for being rich. Capital
becomes the most important component in the capital/labor/resources
equation. Since the purpose of the Renaissance innovations was to keep the
currently wealthy wealthy, the currency was biased to favor those who had it
- and could mete it out at high interest rates to those who needed it for
their transactions.

What we witnessed over the past decades has been the necessary endgame of
the scenario.

Today, in essence, the central bank lends money to a federal bank, which
loans it to a regional bank, and so on, each bank paying interest to the
bank above, and charging more to the one below. By the time the person or
business who needs the money gets it, they're paying an awful lot of
interest - so much, that it amounts to a drag on their ability to do
business. The speculative economy, rather than fueling the real economy,
drags it down.

The only way for banks - who run such an economy - to make more money is to
lend more out. So they looked for more borrowers, as well as more places to
park their cash. As a result, the things you and I depend on in the real
world became investment vehicles. Homes, oil, name it. So
the costs of all these things went up not because of any real laws of supply
and demand, but because they had become new classes of investment.

As for finding new borrowers, well, that's why Bush kept talking about "home
ownership" as the right of every American, why lending standards were
lowered and, of course, why bankruptcy for individuals was made so much
harder. They wanted to lend more money, but didn't have any more qualified
borrowers. By changing bankruptcy laws, they meant to make it impossible for
borrowers to cry uncle. (This was a 150-million-dollar lobbying effort by
the credit industry, over the course of an entire decade.)

Eventually, the tension between the speculative economy and the real economy
simply had to become too great. Lending money, in itself, doesn't actually
produce anything. On the contrary, it strains those few who are still
attempting to produce things. It's what turned so many companies into
balance-sheet-driven outsourcing operations. Only so many bankers and
investors can be supported by industry and homeownership.

We're not really watching an entire economy fail. We're watching a
particular program fail. Only because it's not sandboxed like a bad plug-in
in Google's Chrome browser, the resource leak sucks money from everywhere.

If we can adopt what we Boingers might call the "Happy Mutant Approach" to
this crisis, however, this is not an entirely hopeless situation. Yes,
corporations may lose the ability to keep us employed as the banking
investment they depend on to operate dries up. But this corporate activity
was always extractive in nature, getting (or, historically, forcing) people
to buy mass-produced, and nationally distributed food and other goods that
were once produced locally.

The collapse of centrally controlled commerce and currency simply creates an
opportunity for local commerce and currency to revive. For people to learn
to work and live together on a human, local scale - as the original free
market advocate, Adam Smith, actually suggested. Admittedly, this would be a
painful transition for many - but it's better than maintaining dependence on
a fiscal system designed from the start to turn people and communities into
extractable corporate assets. (Think about that the next time you're called
up to "human resources.")

Whether or not we've had time to fully embrace the
Craft/Maker/cyberpunk/Boing ethos, our ability to provide for ourselves and
one another directly, locally, even socially instead of entirely through
centralized commerce, will determine how well we can navigate the near

For starters, check out the LETS system and other complementary currencies
( for how to make your own currency,
Bernard Latier's book The Future of Money free online (
<>, and Local Harvest for Community
Sponsored Agriculture opportunities near you.

Money can be just as open source as any other operating system. It used to

(Douglas Rushkoff is a guestblogger)