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Phase 2 Review Reserve Bank Act Submission
January 25th 2019
This is only the introduction and the conclusion.
Read the full submission here (pdf)
In 2012 the International Monetary Fund published a lengthy report entitled the Chicago Plan Revisited.
Its authors, two senior researchers, one of whom is now a senior researcher at the Bank of England, investigated, analysed, and modelled a plan of a similar name proposed in the 1930's by leading economists including Irving Fisher and Henry Simons.
Their conclusion was that governments should issue credit through their Central Banks for use to, for example, provide the country with funds for building assets.
They identified a number of very significant advantages over the present system in using that mechanism. One in particular was there would not be Inflation generated as a result. A second and highly desirable one was that the government would not be using precious tax revenues to fund the interest payments on money accessed from the private sector.
That tax revenue, currently approximately $5 billion dollars each year, would become available to provide services such as health, education, etc for New Zealanders.
Japan is currently using that mechanism as is China.........
Conclusion
On all counts there would appear to be only wins for a government that had recommendations with so many benefits, in a report from an institution such as the Reserve Bank, that it could use as a basis for proposing such measures be adopted.
We urge you to investigate the possibilities, our references, and include those recommendations in your report.
LINKS for download:-
IMF Paper – The Chicago Plan Revisited (pdf)
Bruce Beetham - Reserve Bank Amendment Bill 1978 (pdf)
Bruce Beetham - NZ Credit & Currency Bill 1978 (pdf)
Bank of England - Money Creation In A Modern Economy (pdf)
German Central Bank - Money Creation April 2017 (pdf)