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Download PDF Version of Vol. 118 No. 4 Ethical Record The Proceedings of the Conway Hall Ethical Society Vol. 118 No. 4 £1.50 May 2013 EDITORIAL – UNIVERSAL BENEFITS VERSUS MEANS TESTS The past few weeks have seen a curious phenomenon. Sections of the media and many people have suddenly become considerably exercised over the alleged injustice of certain ‘universal’ benefits, eg free travel passes for the over 60s, the winter fuel allowance for pensioners and free TV licences for the over 75s. The cry has gone up that rich people should not accept these benefits or should seek somehow to repay or refund them, or be subject to a means test before getting them, with all the extra bureaucracy this would involve. What’s been largely ignored in all this clamour is that millionaires are also entitled, should they wish to avail themselves of them, to free health care, free education (till 18) and free fire and police services, together worth potentially tens of thousands of pounds. But the country needs only a single means test and it already has it – income tax. A properly constructed income tax, whereby the rich are subject to progressively higher rates of tax, would take care of all apparent anomalies. This preserves the logical simplicity of the universal benefit system. HELP SPREAD HUMANISM IN AFRICA Leo Igwe of Nigeria will distribute copies of Barbara Smoker’s Humanism to schools and groups in Africa which are desperately short of text books expounding the history and concepts of humanism. We have spare copies but need help with the postal charges. Send £10 to Conway Hall Ethical Society to send 10 copies or £20 for 20 copies (marked ‘Africa’). Thank you. 5th Edition SPREAD ENLIGHTENMENT! COLLAPSING PYRAMIDS : MONEY, AUSTERITY AND THE FINANCIAL CRISIS Ken MacIntyre 3 ADVENTURES WITH THE ENEMIES OF SCIENCE Will Storr 8 WITCHCRAFT AND DEATH IN UGANDA Leo Igwe 17 JOSEPH McCABE (1867 – 1955) – FEARLESS FREETHINKER Norman Bacrac 18 BOOK REVIEW - Leslie Scrase’s THE 4 GOSPELS THROUGH AN OUTSIDE WINDOW Jennifer R Jeynes 27 FORTHCOMING EVENTS 28 CONWAY HALL ETHICAL SOCIETY Conway Hall Humanist Centre 25 Red Lion Square, London WC1R 4RL. Main phone for all options: 020 7405 1818 Fax (lettings): 020 7061 6746 www.conwayhall.org.uk G.C. Chairman: Chris Bratcher G.C. Vice-chairman: Giles Enders Editor: Norman Bacrac Please email texts and viewpoints for the Editor to: [email protected] Staff Chief Executive Officer: Jim Walsh Tel: 020 7061 6745 [email protected] Administrator: Martha Lee Tel: 020 7061 6741 [email protected] Finance Officer: Linda Lamnica Tel: 020 7061 6740 [email protected] Librarian: Catherine Broad Tel: 020 7061 6747 [email protected] Hon. Archivist Carl Harrison carl @ethicalsoc.org.uk Programme Co-ordinator: Sid Rodrigues Tel: 020 7061 6744 [email protected] Lettings Officer: Carina Dvorak Tel: 020 7061 6750 [email protected] Caretakers: Eva Aubrechtova (i/c) Tel: 020 7061 6743 [email protected] together with: Brian Biagioni, Sean Foley, Rogerio Retuerma Maintena nce: Zia Hameed Tel: 020 7061 6742 [email protected] New Members We welcome the following new members to the Society: Richard Comaish, Beckenham, Kent; Stella Dessoy, London, W6; David Garcia, London, SE1; Chantal Glover, London, N22; Park Limpongpan, Godalming, Surrey; Morgan Philips, London, SE13; David Secker, Ealing, London; Anthony Taylor, Chelmsford, Essex; Joy Eleanor Wood, London, WC1N; Mazin Zeki, London, N15. THE HUMANIST LIBRARY AND ARCHIVES The Humanist Library and Archives are open for members and researchers on Mondays to Fridays from 0930 - 1730. Please let the Librarian, Catherine Broad, know of your intention to visit. The Library has an extensive collection of new and historic freethought material. Tel: 020 7061 6747. Email: [email protected] CONWAY HALL ETHICAL SOCIETY Reg. Charity No. 251396 Founded in 1793, the Society is a progressive movement whose aims are: the study and dissemination of ethical principles based on humanism and freethought the cultivation of a rational and humane way of life, and the advancement of research and education in relevant fields. We invite to membership those who reject supernatural creeds and are in sympathy with our aims. At Conway Hall the programme includes Sunday lectures, discussions, evening courses and the Conway Hall Sunday Concerts of chamber music. The Society maintains a Humanist Library and Archives. The Society’s journal, Ethical Record , is issued monthly. Memorial meetings may be arranged. The annual subscription is £35 (£25 if a full-time student, unwaged or over 65) If you have any suggestions for speakers or event ideas, or would like to convene a Sunday afternoon informal, get in touch with Sid Rodrigues at [email protected] or 020 7061 6744. 2 Ethical Record, May 2013 COLLAPSING PYRAMIDS : MONEY, AUSTERITY AND THE FINANCIAL CRISIS Ken MacIntyre Lecture to the Ethical Society, 17 March 2013 The financial crisis is a consequence of the nature of money in our modern banking system where almost all our money supply originates as credit created by private banks. As Adair Turner, Chairman of the Financial Services Authority, stated in a speech to the South African Reserve Bank in November 2012: The financial crisis of 2007/08 occurred because we failed to constrain the private financial system’s creation of private credit and money. The UK money supply increased eight-fold from the mid 1980s to 2008 from £250 billion to over £2 trillion {two million million. [Ed]}. Over the last 40 years, the removal of restrictions on bank credit creation has led to a giant banking pyramid scheme 1 which is now collapsing. Keynes’s advice in the preface to the 1935 General Theory is relevant in understanding the crisis: The ideas which are here expressed so laboriously are extremely simple and should be obvious. The difficulty lies not in the new ideas but in escaping from the old ones which ramify for those brought up as most of us have been into every corner of our minds. We must forget everything we are told about money, as we must ignore references to the ‘economic climate’ as if this was a natural phenomenon over which we have no control, like the weather. In his 1932 acceptance speech to the Democratic National Convention, Franklin Roosevelt reminded his audience that we are dealing with social rules and conventions, and that these can be changed: Our Republican leaders tell us economic laws – sacred, inviolable, unchangeable – cause panics which no one could prevent. But while they prate of economic laws, men and women are starving. We must lay hold of the fact that economic laws are not made by nature. They are made by human beings. How Banks Create Money Turner’s credit excesses began with an obscure piece of legislation in 1971 (Competition and Credit Control) following which debt in the UK economy exceeded the capacity to pay by 2008. Banks were free to create money by making accounting entries in borrowers’ bank accounts. ...banks extend credit by simply increasing the borrowing customer’s current account... Paul Tucker, Deputy Governor of the Bank of England 2007 The pre-eminence of banking over all social and economic interests is the real meaning of the ‘free market’ revolution implemented in developed economies, notably by the governments led by Ronald Reagan in the US and Margaret Thatcher in the UK. David Harvey 2 identifies the New York City financial crisis of the 1970s as a critical turning point in establishing the principle that financial institutions must be protected at all costs. ‘The market’ is an ideological Ethical Record, May 2013 3 construction which conceals the reality of power. That ‘the market’ plans economic activity better than any other agency is a secular myth. Yet this irrationality is accepted by all major political parties. In reality, all economies are planned. In our money system planning is carried out by the banking sector, proving disastrous in terms of economic stability. There have been 40 years of unprecedented volatility – four recessions, high unemployment, two major banking crises and asset price bubbles. The lessons of the Great Depression have been forgotten and the work of leading twentieth century thinkers such as Keynes ignored. The current recession has lasted longer than that of the 1930s. We are told that austerity is the solution, but tax rises and reductions in public expenditure amount to an assault on 100 years of social progress since Lloyd George’s budget of 1909 introduced the welfare state and the state pension. Why should we have chronic insecurity when we have the most productive society in history? Rather, the solution lies with changing the way money is created. Money Is Little Understood Money is a brilliant social invention which has enabled economic progress through the division of labour and technological innovation. But it is generally little understood by politicians, central bankers, commentators and economists. Only a tiny number of economists predicted the financial crisis because mainstream economics has no theory of money, debt or interest. Mainstream economists believe that the quantity of money in circulation has no impact on output or employment; that debt simply transfers spending power between parties (like lending someone £10 for a taxi fare); that banks are intermediaries, lending on savings, with no role in money creation. Policymakers’ lack of understanding has led to errors: banking bail-outs and austerity. The textbook explanation is that money originated as a means of facilitating barter in an economy dominated by the exchange of commodities. However, barter depends upon the ‘double coincidence of wants’. For example a shoemaker relies on the baker and his family needing shoes, otherwise he starves. Money overcomes this practical difficulty by establishing a system of exchangeable tokens.
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