Wednesday, February 6, 2013

#0 Looking Back and Forward by Spencer Heath MacCallum

Source -

Beginning the 24th paragraph of Spencer MacCallum's wonderful piece we read,

About this time [1970's?], a couple of interesting projects unfolded. The first was discovering the rigorously free-market monetary ideas of E.C. Riegel. He had been a friend of Popdaddy's, living in Greenwich Village, in the last stages of Parkinson's Disease when I met him. On a hunch that his papers might contain valuable ideas, knowing that Popdaddy endorsed his ideas on money, I kept in touch with the family who received his papers on his death in 1955. Ten years later I was on hand to save them from being dumpstered.

Here then, we have another remarkable instance of treasures being saved from oblivion. The Scarlatti harpsichord sonatas and the Bach Brandenburg Concertos are similar treasures, as are many of the unpublished works of Franz Schubert.

Almost ten more years went by, and I showed an essay from them to Harry Browne, who in his best-selling You Can Profit from a Monetary Crisis (Macmillan 1974), called it "The best explanation of the free market I've seen." A flurry of requests for the essay encouraged me to systematically examine all the papers and eventually edit and self-publish two books from them, The New Approach to Freedom (1976) and Flight from Inflation: The Monetary Alternative (1978). From Riegel I came to respect the notion of an abstract unit of value whereby exchange might be facilitated by simple accountancy among traders in the market. Issue of new units would be by traders monetizing their future productivity, then redeeming them as they offered goods or services competitively in the market.

Updating this idea, what I am proposing that we should do is to open up the issue of new units (Value Units) to individual human beings (traders by implicit regard in the market) who would not just monetize their future productivity, but in the case of the retired and elderly, military veterans or the disabled, to monetize their past productivity, much of which may well have been stolen. Were a monetary system to emerge that would stand apart from any and all governments, there would have to be a means of transition into such a system, such that those marginalized by the present system, would see a future for themselves and their younger relatives and be able to participate in it as far as possible. [It is fair to point out to the public at this point in time, that the Founder of the RMES, Mr. Laurence Gilbert, believes that this would add too much inflation and destroy the purity of his monetary system, therefore he rejects it.]   

Inasmuch as political governments are not traders in the market, they would have no place in such an exchange system.  

Governments act by law which as Bastiat maintained was FORCE. Governments do not produce anything anyone would not rather buy from someone else if they had the opportunity, especially if that opportunity were close at hand rather than far away. Governments also do not bargain, they take by FORCE and they spend on things that benefit them rather than those they supposedly govern.

Should such a unit of account [the Value Unit] come to be preferred over legal tender for its constancy, political governments would no longer be able to deficit-finance. Not being traders, they would have no issue power, and having no issue power, they would have no means of watering the money supply. This is radical thinking, but I have fostered interest in it whenever opportunity has arisen. Riegel's material is on a website and soon will be on another.

Neither of those websites at this writing (2013) were mine, therefore this is a third website devoted to Riegel's ideas and what we can make of them for ourselves at this point in history. We are sincerely grateful for Spencer MacCallum's contributions. After all, if he had not saved Riegel's work from oblivion, we wouldn't be writing this.

David Burton

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