“The Gaia Plan: A Worldwide Guaranteed Income”
By Richard C. Cook
Speech Prepared for “Public Banking 2013: Funding the New Economy”
Sponsored by Dominican University and the Public Banking Institute
San Rafael, California
June 2, 2013
My name is Richard C. Cook, and I am grateful to Dominican University and the Public Banking Institute for inviting me to speak today. I am a very happily retired federal government analyst who spent 32 years working in Washington, D.C., for a number of agencies, including the Food and Drug Administration, the Carter White House, NASA, and the U.S. Treasury Department. I served at Treasury for over 20 years. But I am also a lifelong student of meditation and spirituality, which has led me to see many things differently from the typical bureaucratic perspective.
I am the author of four books. The first was In the Footsteps of the Yogi about a guru from India with whom I worked and traveled during my vacations from work for seven years. Then, when I retired from the government in 2007, I published Challenger Revealed, about my days as a whistleblower following the space shuttle Challenger disaster.
Then, sitting in a small apartment where I was living in College Park, Maryland, I began writing articles on the growing financial crisis and, along with a few others, predicted the crash of 2008. The coming of the crash was obvious due to the insanity of unsustainable debt-to-equity ratios in the economy, and people who listened saved a lot of money when the stock market tanked. Because when debt reaches a critical mass, which it has done repeatedly during the boom-bust cycles of past decades, a crash is inevitable. It doesn’t matter if it’s a merger/acquisition bubble, a dot.com bubble, a housing bubble, a stock bubble, a gold bubble, a government bond bubble, or a new housing bubble. The result is always the same. Our economy has been based on the inflation and deflation of bubbles for a generation. Bank-run economies are like that, with devastating effects on those who work for a living.
In 2009 I published a book based my ideas on the monetary system entitled We Hold These Truths: The Hope of Monetary Reform. Then I turned again to the spiritual teachings. I had remarried in 2009, and my wife Karen and I left the Washington, D.C., area and are now teaching meditation and spirituality in Roanoke, Virginia, in the Appalachian Mountains. A few months ago I published my most recent book, Return of the Aeons: The Planetary Spiritual Ascension, which contains a chapter on my monetary ideas and proposals entitled “Monetary Metaphysics.” In my book I make note of the extremely perilous condition of the United States at present due to the fact that it has fallen under the almost complete control of the financial cartel, what you could justifiably call a financial Mafia, headquartered in Wall Street.
This cartel controls all aspects of economic life in the U.S. today, along with most of our politics and much of our media and culture, and is part of an international financial conglomerate. The peace and sanity of the world are in great peril today, especially with the continuing potential of world war taking place between West and East. Though I think the growth of spirituality in the world promises a splendid future, on the way to getting there we are facing a disaster of tremendous proportions. So as we face these prospects it is essential for people like us, behind the leadership of organizations like the Public Banking Institute, to hone our thinking about the kind of world we wish to create while things are falling apart around us and as we prepare for a future where the old structures will have collapsed and passed away.
Public banking is an unbelievably important topic and a very broad one. It includes a multitude of reforms and a great variety of approaches. But they all derive from the proper definition of money as a public utility, which is also the title of my six-part video series you can find on YouTube: “Credit as a Public Utility.”
It is the duty of any government to provide a circulating medium of exchange for the movement of trade and the facilitation of free exchange of labor. This is a novel concept because we have been brainwashed into believing that the only way money can or should be created is through lending from private banks, under the umbrella of a central bank like the Federal Reserve System.
But the difference between private and public control of banking, credit, and money is like night and day. Private control of money-creation is the way the financial elite maintains control of the world that they are destroying daily through greed, exploitation, violence, and enslavement of humanity. Public regulation of banking is a major part of our hope for a future of ecological sanity whereby humanity might exist as a human family and friends of our mother the Earth.
The Federal Reserve System, while literally owned by its private banking members, is chartered by Congress, proving that our system of government does implicitly recognize that the monetary power is sovereign to the people of the nation, even though that sovereignty has been given away or perhaps stolen. In fact, much of American history can be analyzed as a struggle between private and public control of money creation. During colonial days the colonial legislatures exerted their sovereignty by creating a number of regional currencies, including those of the Pennsylvania land bank, Virginia tobacco currencies, etc. In 1764 the British Parliament abolished any further issuances, which led to an economic depression. Benjamin Franklin recognized this as the primary cause of the Revolutionary War, though our historians, largely drawn from the Eastern financial and academic elite, have conveniently ignored this part of our history.
The Articles of Confederation, under which the Revolutionary War was fought, extended to the Continental Congress the right to create money through the issuance of what were called “bills of credit.” Under this provision, the continental currency was spent into existence, an entirely legitimate system not based on any kind of debt, which sustained the American war effort until France entered the conflict. The value of the continental currency, which has been much maligned by official academia, was actually destroyed by British counterfeiting.
By the time the U.S. Constitution was ratified, the bankers had begun a renewed effort to take over the country. The chief instigator was Alexander Hamilton, who had become the mastermind of the New York banking cabal, closely allied to the banks of Great Britain. They prevented bills of credit from appearing in the new Constitution, except to mention that the right to issue them was expressly prohibited to the states. The central government was given the power to tax, to incur debt, and to mint coin, but this was really to mint coin for private parties, not to establish a national printed currency. However, the Constitution also gave the government the power to regulate interstate commerce. Under the implied powers doctrine, this in itself provides the basis for a national monetary system. Again, this point has been ignored by academia.
However, the role of the federal government was ambiguous, which allowed Hamilton, as Secretary of the Treasury, to use the implied powers doctrine to create the First Bank of the United States, an imitation of the Bank of England. The First Bank was to be capitalized by U.S. government debt, which is similar to the system we have today.
But Thomas Jefferson, James Madison, and others saw what Hamilton was up to. After Jefferson was elected president through what was called the “Revolution of 1800,” the First Bank was downgraded, then eliminated. Later the Second Bank reared its head but was marginalized by President Andrew Jackson until its charter expired. Until the Civil War, the U.S. developed without a central bank and, not coincidentally, without a large standing army. Banking was done by a network of private and state-owned banks, later derided as “Wildcat banks,” but which served the nation extremely well. These existed in tandem with capital markets that effectively funded such projects as the building of the Erie Canal and the early railroads.
Then came the catastrophe of the Civil War. Congress, with President Abraham Lincoln’s cooperation, saved the nation through the printing and issuance of Greenbacks, which were spent by the government directly into circulation as payment for wartime expenses. The Greenbacks were a tremendous innovation but were also denigrated by historians. Actually, they helped give us an effective circulating currency for several decades, even into the early 20th century.
But the banks had been able to stage a major coup by the adoption in Congress of a new national banking system under the National Banking Act of 1863. While there was no central bank, the state and local bank currencies were outlawed, with national banks again becoming collateralized by federal government debt as were the First and Second Banks of the United States. The central bank came back into existence in 1913 when the Federal Reserve System was created and the government surrendered its sovereignty over money to the private banking system that owns the Federal Reserve.
But the power struggle continued. The bankers took us into World War I on the side of Great Britain, then gave us some economic boom times until the crash of 1927, which was caused by a contraction of the currency emanating from Great Britain. President Franklin Roosevelt gradually took over de facto control of the banking system, including the Federal Reserve, through his appointment of Marriner Eccles, one of his close allies, as chairman. The New Deal and the post-World War II economic boom were created by low interest rates and federal control of the banking system in addition to wartime consumer savings. But this began to change during the 1950s while Dwight Eisenhower was president. Interest rates began to rise, but the great turning point was the assassination of President John F. Kennedy in 1963.
It is not sufficiently recognized the extent to which Kennedy was viewed as an enemy by Wall Street and the banking industry. There is a tremendous book on this subject entitled Battling Wall Street: The Kennedy Presidency by Professor Donald Gibson of the University of Pittsburg. With Kennedy out of the way, the power of the bankers grew to where it is today. The inflation of oil prices in the 1970s was engineered by the bankers, as was Nixon’s abandonment of the gold peg, as was the creation of the petrodollar, as was the destruction of American small business in the recession of 1979-1983. Then came the so-called Reagan Revolution that turned the nation’s economy over to Wall Street entirely, followed by the key measure whereby President Bill Clinton agreed to repeal the Glass-Steagall Act through which commercial and investment banking had been kept separate for over a half-century. The results of all this were catastrophic.
The U.S. Main Street economy was wrecked, with Wall Street and the banks gaining the power to smash the economy, destroy the labor movement and the middle class, and gain obscene profits from the roller coaster of booms and busts that has terrorized our nation for the last several decades. All this was facilitated by the computer automation of banking and money transfer that has allowed the use of derivatives to store bank-generated wealth that they could not utilize by lending at interest.
That’s it in a nutshell, and it’s high time for the advocates of public banking to fight back, and that’s what Ellen Brown and her colleagues at the Public Banking Institute are doing. And it shouldn’t just be done at the state level, though it was Ellen’s discovery of the state-operated Bank of North Dakota that started the ball rolling. Public banking can also be done at the national level, through legislative changes that could make the U.S. Treasury a bank of issue or by chartering a new public central bank to replace the Federal Reserve. Treasury could easily issue federal payments directly for infrastructure, as the American Monetary Institute and Dennis Kucinich have recommended, or it could issue a citizens dividend instead of bank bailouts. It could also monetize local complementary currencies.
So what I would like to suggest is that those of you here at this conference expand your minds as much as possible about how money is created and distributed and indeed what money is for in the first place. And then what is life for–why we exist and what we are intended to accomplish during our lifetime on this planet. And how the spiritual traditions down through the ages call upon us to treat one another. Every one of them has some form of the Golden Rule: treat others as you would have them treat you. Does a banking system based on monetary slavery do this?
Two years ago I was invited to address the annual meeting of the International Reciprocal Trading Association (IRTA) at Puerto Aventuras, Mexico, on the Yucatan Peninsula. My wife Karen joined me on this fascinating journey where we also visited ruins of the ancient Mayan civilization. We stayed in a luxurious all-inclusive resort in the vicinity of dirt-poor towns where modern-day Mayans live in abject poverty.
At this conference I made two proposals. The first had to do with promoting financial freedom for any organization, institution, or jurisdiction that creates an alternative currency, including bartering organizations that set up a centralized exchange system to monetize the inventory of participating business entities. IRTA, for instance, has created a system called UC, or Universal Currency.
It’s a marvelous system. There is only one problem, which I explained at their conference. We know, you see, that alternative currencies are legal under the Internal Revenue Code so long as these currencies are denominated in units equivalent to the U.S. dollar and so long as anyone–business or person–pays tax to IRS on any profits realized in the alternative currency. But the tax must be paid in U.S. currency alone.
This is totally wrong. I argued to IRTA that this regulation is unconstitutional in terms of denying the business or person using UC or any other alternative currency the equal protection of the laws as specified in the Fifth Amendment. So I told IRTA that they should immediately launch a lawsuit against IRS demanding that they be allowed to pay income tax in their alternative currency, the one they have created based on the value of their commodities for purposes of trade.
Now, people might argue that it would be chaotic if anyone could just invent a currency, then pay taxes denominated in that currency. They say that alternative currencies are not and cannot be “legal tender.” But “legal tender” is an arbitrary concept. Anything could be declared “legal tender.” Why does it just apply to bank-created debt-based Federal Reserve notes?
You may have noticed that any authoritarian gatekeeper uses as his first argument against human liberty that it is “chaotic.” But if a currency invented by barter association members is being used to move trade, it is a legitimate currency.
Please, ladies and gentlemen, understand this principle. And I can tell you based on my own government experience that it would be the easiest thing in the world for the Treasury to convert that currency upon receipt for taxes into U.S. dollars. Such a provision would immediately bring about a huge increase in circulating currency sufficient to break the banking monopoly on money-creation and would eliminate the ongoing Great Recession practically overnight.
When I made this proposal, the IRTA members gave me a standing ovation, because they realized the significance of what they had heard.
So in your approaches, I would also urge the Public Banking Institute not to confine itself solely to banking and lending and to better and more efficient ways of running the fractional reserve system. What I am saying is that any association of traders or producers should have the right to become their own bank of issue by monetizing the value of their trade, production, or inventory. The simple reform I am talking about would do that on a scale that would revolutionize economics. It could apply to any community-based alternative or complementary currency in existence and link those currencies to the public financial system.
My second proposal to IRTA was for there to be established a worldwide basic income guarantee under the auspices of the U.N. or some other central authority, whereby a basic subsistence income would be paid to every adult on the planet. I call this the Gaia Plan.
Now some people throw up their hands in horror–why this is “one-world government” they say. My friends, we already have one-world government: namely the tyranny of the international banking cartel, affiliated with entities like the Bilderberg Group, a cartel which seeks to establish control over every nation on earth by monopolizing the issuance of currency worldwide. A financial Mafia doesn’t just run the U.S. They want to run everything.
In fact, they have decreed an international liquidity collapse that is going on right now so that they can establish totalitarian control over the entire world. Don’t believe me–they have told us what they are doing and you can see it on YouTube. What do you think is going on under your nose? Do you think it’s accidental or systemic? Well it’s not. And it’s not just the U.S. banking system or the Federal Reserve. It’s the wealthy owners of the entire world financial system. And the way to break their power, which is really a power to commit selected genocide, is through measures like public banking, alternative currencies, and the Gaia Plan.
I am a member of the U.S. Basic Income Guarantee Network and have addressed two of that organization’s national conventions. Those of us who are members of the network believe that as a matter both of justice and of economic policy, each person in society, usually expressed as each adult, should receive a free and unencumbered stipend sufficient to sustain the basic requirements of life. This stipend should be granted regardless of employment status and without any means test. We view it as a fundamental human right belonging to every individual on the planet. An example of such an initiative on a limited scale is the Alaska Permanent Fund, whereby every Alaska resident receives a check annually as that person’s share of the state’s resource revenues.
The nation furthest along to implementing a basic income guarantee is Brazil. Serious initiatives are underway either as pilot programs or official proposals and studies in Italy, Finland, the state of Oregon, and elsewhere. There are also petitions circulating among the nations of the European Union to bring the idea of a basic income guarantee before the EU parliament for formal analysis and debate. The emerging basic income movement is a growing force around the world as nations and people contemplate the wreckage and injustice of the world financial system.
The idea of a basic income guarantee has deep roots in the world’s spiritual traditions, as well as in the concept of citizenship. The idea that without bank-originated money you starve and die is very much an innovation of modern materialistic societies.
Note, however, that the Gaia Plan goes directly counter to all those who insist that the way to save the world is for more and more jobs to be created. This is a strong prejudice and a hard mental habit to break. But the fact is that technology is constantly eliminating jobs by making work more productive. More and more jobs are being eliminated all the time. By the year 2030, experts estimate, half of all current jobs will be gone. So where will purchasing power come from?
But why don’t people realize this is a good thing? This is an actual real-time appreciation of the value of the world economy. It means that the leisure dividend which we once thought held great promise but has proved an impossible dream would actually become possible. The desirability of a leisure dividend was first enunciated over a century ago by Nikola Tesla.
Of course all of us who have advocated a basic income guarantee have heard the scorn heaped upon our ideas, for instance, the labeling of them as vestiges of the outmoded concept of the welfare state. We have been called socialists or communists or worse, and we have heard the vehemence with which people protest any suggestion that those lazy s.o.b.’s should get something for nothing while I have to go to work every day to earn my keep. Of course these same people who attack us are silent at the idea of those who inherit millions or billions or live without doing anything except keep track of their interest and dividend payments.
And what would people do who could live on a subsistence stipend? Wouldn’t they just get drunk or take drugs? Well, humanity is growing up. Here are some suggestions: spouses could take turns staying home to help raise children; doing volunteer charitable work; eldercare; creative artistic activity; devotion to meditation and spiritual pursuits; earlier and more secure retirements; starting small businesses; urban gardening; being a student without running up astronomical debt; learning a new trade; building or refurbishing your house; or dozens of other worthwhile occupations that today people can’t afford to engage in.
Let me tell you something else. One of the greatest advocates of such a system in modern economic life was the guru of conservative monetarist policy, Milton Friedman. In the 1960s Milton Friedman was the foremost spokesman for the reverse income tax. Friedman knew that private enterprise is so efficient and productive that more and more jobs would be disappearing, so that a reverse income tax was the only way to proceed.
Others got on the bandwagon in the 1960s, including Dr. Martin Luther King, Jr., Senator Daniel Patrick Moynihan, and President Richard Nixon. All this had been figured out. A proposal came before the U.S. Senate and was barely defeated by the opposition of white Southern senators belonging to the Democratic Party. Why? Because they didn’t want blacks to benefit. The opposition was racist.
What we got instead was the earned income credit, which is something, but really a pittance. We got a lot of other welfare measures but with a grossly inefficient self-serving bureaucracy to administer them, combined with the downside of permanently scarring the psychology of welfare recipients by making them into welfare slaves with all the evils attendant upon that status. We got the collapse of our inner cities into urban death zones. When in reality the solution was so simple–circulating credit along with the basic income guarantee.
Some very smart people like to ask, “Where’s the money going to come from?” That’s the Tea Party answer to everything. Something else the Tea Party says, and you may have seen their posters, is “Keep your government hands off my Medicare.”
Well, please read my book, We Hold These Truths: The Hope of Monetary Reform, as it tells you where the money will come from. In particular, please examine carefully what I say about the ideas of British reformer C.H. Douglas, the founder of the incredibly important Social Credit movement that was a powerful force in Great Britain, Canada, New Zealand, and Australia between World Wars I and II.
Douglas advocated for the periodic distribution of what he called a National Dividend to monetize the cumulative appreciation of a nation’s productive capacity, a concept fought bitterly by Keynesians who advocated a “full employment” solution that in reality was, and is, very close to being another form of communism. Today the Social Credit movement remains of importance. See for instance the Guardian Political Review of New Zealand, which is the publication of the New Zealand Democrats for Social Credit. This magazine is the most intelligent publication of its type in the world. These are people who truly understand money.
I would add that in fact the very smart people who ask where the money will come from never ask where the $600 trillion in derivatives running loose in the world economy comes from. That’s because they don’t know and maybe don’t care. And Fox News doesn’t tell them.
In fact, that money comes through the fractional reserve system’s overnight deposit function that was implemented through electronic funds transfer following the cybernetic revolution of the 1980s. Incredible amounts of money were generated from shuffling reserves around using EFT. Everyone in Treasury knew that. And there was no way for the banks to lend it out into the producing economy, because such amounts could never be repaid by businesses and certainly not by consumers. So it was turned into derivatives: just a big casino with millionaire bankers skimming the cream in fees, bonuses, and commissions. The ultimate corruption.
What I am saying now is that instead of putting that reserve-generated capital into derivatives, use the potential credit for the basic income guarantee. And it would not necessarily cause inflation, because it would be balanced by the production and consumption of goods and services locally that it would call forth in the liquidity-starved local economies of the world. And it could also help capitalize the public banks for which the Public Banking Institute is advocating. And it would also result in a cultural and spiritual rebirth by people who didn’t have to engage in useless, unneeded, and menial service-industry jobs, or worse, engage in internet fraud or various forms of prostitution and wage slavery, as hundreds of millions of people have been reduced to worldwide in our enlightened era. In fact the biggest job-creation welfare program in the world is the U.S. military. Look around you, ladies and gentlemen, and see what is really going on in the world today.
So I would like to call your attention today to my proposal for the Gaia Plan as a supplement to your many other excellent ideas and proposals for monetary reform. I believe if you really think about it you will see that the Gaia Plan is a measure that provides a spiritual solution to the problem and makes us into ones who love our neighbor as ourselves. Don’t say it “can’t” or “won’t” happen. The world has changed remarkably even in the last four to five years. When you say or think “can’t” or “won’t” you are binding yourself to the past and destroying your own freedom.
On the New Earth that is coming, love for humanity is replacing fear. That is how the world is going to change and is in fact the only way.
© 2013 by Richard C. Cook.
Richard C. Cook is a retired federal government analyst who now teaches meditation in Roanoke, Va. His most recent book is Return of the Aeons: The Planetary Spiritual Ascension. His website is www.richardccook.com.