Herman Daly gives a brief account of the philosophical basis of Fredrick Soddy's Cartesian (dualistic) approach to economics.
Soddy, a (real) Nobel prize winner in chemistry, held that entropy is a chief limitation and that credit is not capable of creating perpetual motion, given finite real resources and the mathematics of compound interest. He was an opponent of economists' unlimited growth model and an advocate of 100% reserve banking under the gold standard of his day. Today he is better known as the founder of steady state economics, the forerunner of the economics of sustainability.
Center for the Advancement of the Steady State Economy
Dualist Economics
Herman Daly
Soddy was great, no doubt, but common stock as private money ALLOWS but does require REQUIRE growth so it is superior to 100% reserves which REQUIRES growth at at least the nominal interest rate.
ReplyDeleteAnd Heaven forbid we should ever rape the environment for mere money tokens as under a gold standard which is fascist too, btw.
Compound interest is just one of the frictions (losses) in the credit circuit....
ReplyDeleteAs I pointed out in my post, savings and income taxes that accrue against income generated from advances.
Taxes are a special case because the funds actually vanish, as opposed to the others, where the funds are only redistributed towards the top of the income spectrum (as if that weren't bad enough).