The following presentation was delivered in South London to the 48th meeting of the New Right on Saturday, March 22, 2014. Although it is verbatim in spirit, if you want to hear what I actually said word for word, please check out the video on either YouTube or the Internet Archive.

A few points: the references to Newland Engineering and Griffin Farm Supplies is an in-joke; Mike Newland was in the audience, and although long retired he is indeed an accountant by profession.


Pay Wealth-Creators, Not Banksters


Good afternoon everyone,

The subject of this dissertation is as Adrian says the financial system, not the way it is, but the way I envisage it could be. Herein I will be going beyond the usual rants against usury, and propose something that is both startlingly original and yet by the same token startlingly obvious, yet strangely no one else on this planet appears to have considered it before. I am therefore like Socrates in a class by myself.

As we all know, there is a big difference between money and real wealth. Wealth is created by human action; true, the best things in life are free, that’s until the Tories figure out a way of bring in a sunshine tax, and even in this day and age it is possible for example to forage for food, but in practice if you or I want something, we have either to create it ourselves in whole or in part or obtain it from someone else who has done the same thing. Even if the object of our desire – be it a tin of fruit or a new car or whatever – comes to us fourth, fifth or Nth times removed, it has to be built, manufactured, someone else.

Usually to obtain such goods and services we part with money, and generally we obtain this money by parting with something else, that is we sell something, perhaps our labour. But where does money come from? Well, ultimately that too is created, and broadly speaking it is created by either the government or by the banks.

Generally, the government creates only a tiny percentage of the money supply, such a tiny percentage that it is a truism the financial system is what the great Major Douglas called the monopoly of credit. (1). This is a legal monopoly, indeed as Sean Gabb our keynote speaker will tell you if you buy him a drink at the bar later, a monopoly can be enforced only by law. In America, that power resides in the misnamed Federal Reserve System, the private cartel that is the de facto central bank of the United States. In Europe, including the UK, that monopoly is enforced by the Treaty of Maastricht. Although money is not true wealth, the possession of money gives us the power to own anything that it is possible to own and that we could reasonably want. For this reason, the banksters protect their monopoly fiercely, and for the same reason, they are the de facto masters of us all.

I don’t think I need to explain in detail to such an enlightened audience how the banks create money, but I will give you the following example, again by courtesy of Major Douglas. I’ll ask you to bear in mind that the figures I use here are not only illustrative but nearly a century old. (2)

A new bank is started, and 10 customers each deposit £100, making a total of £1,000 liabilities. These parties do business with each other, mostly by cheque. After a while, customer number 10 decides he needs a £100 loan.

He is a manufacturer, and has just had a big order, so he goes to see his bank manager. This guy is really sharp, he has been running a company called Newland Engineering for the past thirty years; this is not a limited company but a privately owned business; he is the sole owner, so if it goes belly up, he will lose everything.

He goes to his bank manager and says I’ve just got a big order from the Israeli Government to supply them with generators for a new project in the Occupied Territories. He shows him the order and everything; the bank manager is very impressed, especially as he used to be an accountant prior to setting up his engineering firm. The bank manager advances him a £100 loan and says give me the deeds to your house. He opens a loan account and credits it with £100 repayable at 2% interest.

The situation is now as follows: All 10 customers including the manufacturer have £100 each in their accounts, but the manufacturer also has a debit of £100 to his loan account. This is new money, it has been created at the stroke of a pen.

After handing over the deeds to his house as security, a loan account is opened in which the bank deposits £100 to be repaid at 2 percent interest. The bank has not taken a penny of this money from any of its existing customers, it is literally new money.

The manufacturer draws the full amount, and is successful. He fullfils his order and is paid in full by the Israeli Government, pays his staff, his mortgage, gives his wife some housekeeping money, and sends his son to Switzerland for the school holidays. Then he pays £102 into his loan account; £100 disappears, it is cancelled out of existence. Every loan creates money; every repayment of a loan destroys it. The remaining £2 is the bank’s profit.

Now, the manufacturer obtains his money including his profits from his customers, but it is easy to see that if all manufacturers and everyone else must ultimately obtain money from the banks, that the entire world must go progressively in hoc to the banking system. This is where we are at the moment. This is why we have defaults, inflation, and even war.

Unless the banks keep the money flowing, the economy will collapse. This is one of my favourite quotes on this subject; it was directed at the Lloyd George Government in 1921: “Does he, and do his colleagues, realise that half a dozen men at the top of the five big banks could upset the whole fabric of Government finance by refraining from renewing Treasury bills?” (3)

In order to obtain his money, the manufacturer has invested his time and effort. His employees have invested their time and labour, so like their boss, they deserve to be rewarded, everybody in the firm down to the cleaning lady. Not everybody produces directly, but everyone involved deserves a cut.

What has the bank manager invested though? The answer is absolutely nothing.

A bank has two and only two bona fide functions. There is what I call the strongroom function, and there is the bookkeeping function. Most of us keep some money at home, maybe a share certificate or two, and the family silver, but by the same token, few of us want to keep our life savings under the mattress, so we deposit it in the bank. This is the strongroom function. The bookkeeping function is one we use every day.

If the manufacturer had not come up trumps, if instead of dealing with the Israeli Government he’d dealt with say Griffin Farm Supplies in Wales, had fulfilled his order, and then his customer had gone bust, he’d have lost everything. At one time, people used cheques, they still do on occasion, but nowadays we walk around with these things in our pockets.

[At this point I had intended to show my debit card but temporarily couldn’t find it. This resulted in a brief exchange with a member of the audience].

A debit card performs instant bookkeeping transactions, moving money from your account to the shopkeeper’s, and so on.

Now, banks do other things as well, they sell foreign currency, they sell or perhaps that should be mis-sell – payment protection insurance, but by and large banking is about strongrooming and bookkeeping. This is a service industry, so it does or should contribute to the wealth of the nation, and be paid according. Yet the banks are not simply well rewarded, they own the Earth.

Banking is an example of money for nothing – your money for their nothing. Now I want to talk about the exact opposite: something for nothing.

I am a child of the 70s, and musically that was a fantastic era. At one time I had quite an impressive collection of vinyl. I’m not quite the oldest man in the room, but anybody here not know what I mean by vinyl?


One of the albums I bought at that time was the eponymous debut album by Boston, which is believed to have sold around 20 million copies.

Prices varied, but in the 70s and 80s I used to pay £4, £5, sometimes more for an album. A double album would set you back about eight quid. From about 1967 the Summer of Love until the early 90s, maybe a bit later, a lot of rock bands, singer-songwriters and musicians generally became wealthy men and women, some extremely so. They earned songwriter royalties, money on album sales, tours and spins-offs merchandise, etc.

I don’t know how much Tom Scholz made from Boston, but it must have been a tidy sum. Bands still sell records, through iTunes and such, but, if you have an Internet connection you can have all the music you ever dreamt of and then some, and it won’t cost you a penny.

Not everybody is happy with that state of affairs; it is not only music but films, documentaries, boxing matches, you name it, that are uploaded to YouTube and other video sites. Back in the 1990s there was considerable media outrage generated at times over pirate software, but today you can download all the software you need both free and legally.

Anybody familiar with Mozilla? That’s the company that produces the Firefox browser. There are all sorts of companies that produce free sofware.

There have been attempts to transfer this outrage to music and film downloads, there is even a body called the Federation Against Copyright Theft. Such organisations peddle righteous indignation and all manner of ludicrous scare stories about pirated videos funding organised crime and even terrorism, but the reality is that copyright is dead. Once something is uploaded to the Internet, it can be copied ad infinitum for next to no cost, and because it can be, it will be.

This so-called problem extends to the written word, and this has led to large numbers of local newspapers going to the wall, in the UK and elsewhere. After all, why should people pay for news when they can get it free? This has led to the NUJ and other vested interests calling for newspapers to be subsidised. Sean Gabb will tell you what he thinks about subsidies. Some national newspapers have introduced paywalls, with limited success.

The big question: Is there an alternative to chasing people and organisations for royalties through the courts or for government funding ie taxpayer subsidies? Yes, there is an extremely simple alternative.

Instead of allowing the banks to create credit out of thin air and sell it to industry, the governments of the world should create this credit debt-free, and pay it to the companies that control the Internet, the massive ones, the big ones and indeed the not-so-big ones: Google, Yahoo! Facebook, your ISP, your host, and the larger websites. The world’s largest website is...anybody know what that is?

The Internet Archive, which at the end of February had archived over 390 billion webpages. That is both a free site and a not-for-profit.

These corporations would take a percentage to reward them for their services to Mankind; they would then distribute the rest to companies and individuals copyright holders, performers, etc for their services to Mankind, perhaps on the basis of the number of downloads or pageviews.

When I say copyright is dead, I don’t mean that authors do not and should not have the right to be recognised as the creators of their works. Of course they should, but by the same token, once something is uploaded to the Internet, the creator of that work and all other interested parties should forget about their copyright. But, if a million or ten million people download the next Harry Potter novel or whatever, the governments of the world should create an equivalent amount of money – by a process yet to be determined – and pay the author.

I’ve given some thought as to how this could be done, but it would certainly be best at a national level. There would be different payments for different types of downloads, and this would be limited to new works and to existing copyright holders. Let us take for example the book Harry Potter And The Deathly Hallows. This is said to have sold around 44 million copies. In order for the reader to enjoy this book and if there is one thing we can say about the Harry Potter novels it, is that they have been mega-enjoyed in order for it to get to the reader, after the necessary process of editing it, designing the dust jacket, and advertising it, quite a number of trees would have been chopped down, pulped into paper, then you have the physical process of printing it, binding it, distributing it to warehouses, then shops, and then the money from sales flows back the other way. This is a complex process, and think of all those trees, the equivalent of a small forest. This generates a lot of work on the way, and if you can, imagine that process repeated hundreds of thousands of times a year for other, albeit less popular, books, magazines, newspapers, etc.

On the other hand, for a book to be published solely on-line, all that would be needed was the author and perhaps an editor. It is uploaded to a website, and anyone in the world can download it. The same wealth is created however the book is read, the traditional way, or on-line. If you want to know how to go about publishing a book on-line, again ask Sean Gabb. The end result is the same, someone reads a book. Music-wise, the end result is the same, whether or not a record is distributed through a physical medium, people play it. There is the same net increase in wealth, in fact when it comes to music there is a greater increase in wealth because when it is free, people download more, inevitably. The cost of distributing a book, an album, a film, a newspaper...on-line is not appreciably greater if it is read, watched or heard by a hundred million people. This is something that is currently ignored by economics. So, how much should be paid out to copyright holders and distibutors?

If it were only a pound a “copy” for a Harry Potter-sized book, 50p for an album, and 2p for a newspaper, with say YouTube taking half and passing on the rest, that would both reward wealth producers and pump enough money into the economy for it to be reinvested without recourse to bank-created credit.

The fine details need to be worked out by technicians, and computers, but this is something that can be done relatively cheaply.

Now this would benefit not only creators and distributors of music, literature, news, on-line cookery lessons, anything that is uploaded and then downloaded, it would also be a positive step towards destroying the New World Order.

As I’m sure you all know, there are a number of organisations that meet regularly with the aim of controlling the world. I’m not talking about the Elders of Zion or the Order of the Illuminati, but the Council on Foreign Relations which was founded in 1919; Professor Quigley identified this as the major player, but there are other organisations such as Trilateral Commission, which was founded in 1973, and the Bilderberg Group. When people like Dan Smoot and A.K. Chesterton – founder of the National Front – exposed these power elites back in the 1960s, they were given the silent treatment, and when that didn’t work they were denounced as conspiracy cranks, right wing kooks, and, would you believe it, anti-Semites. Now, the overwhelmingly left wing alternative media has “discovered” these groups without acknowledging the groundwork done by these so-called right wing kooks, and even the BBC has reported on Bilderberg.

The power elites consist broadly of four groups: the banks, their political dupes/co-conspirators, their academic henchmen, and multinationals. And as always, it is those who pay the piper who call the tune. Most “extremists”, people like us and the morons of the loony left, tend to view these power elites as one homogeneous entity, in particular big corporations are viewed as evil, often simply because they are so huge. Even some mainstream politicians adhere to that view. Last year, Margaret Hodge famously branded Google evil because it failed to pay its “fair share” of tax. Sean Gabb will tell you what he thinks about tax. I will return to Google shortly, but first I would like to dispel this myth about big corporations being evil simply because they are big.

Last year, the loonies of the Socialist Workers Party railed in their weekly newspaper against the Tesco supermarket chain after it revealed that some 30,000 tonnes of food produced by the company in the first half of the year had been “wasted”. According to the comrades, “The real problem” is that supermarkets “produce more than they need in the hope of undercutting competitors, then scramble to sell as much as possible at a profit.”

If I may quote Major Douglas again: “It has never been clear to me why any man in any position of life should be expected to perform any action whatever which was not in some sense of the word profitable to him”. (4)

Ditto supermarkets.

Tesco made a group profit of £3.8 billion, a truly astronomical sum, but unlike the banks, who can make that kind of money by simply writing figures in a book, every penny of that profit came from human effort. That £3.8 billion was pre-tax, so it is not quite so big, now, factor in the following:

This profit was on sales of £72 billion, so it is quite a small percentage. Tesco employs staff in 14 countries. Anyone want to take a stab at how many people it employs?

Over half a million.

So this “parasitic” entity provides livelihoods for over half a million people, and provides us with cheap, nutritious food. The left view wasted food as the result of over-production. The reality is there is no over-production under capitalism, what there is, is under-consumption, and that is due entirely to the financial system.

Big companies need to make big profits, and massive corporations need to make massive profits. It is only by operating on such a colossal scale that supermarkets and similar corporations can deliver so much for so little. You simply cannot get the economies of scale otherwise.

One final word about Tesco, as some of you may know, this institution was founded by Jack Cohen in 1924 on the principle of stack it high and sell it cheap. So whatever the Jews have done in the Middle East since 1948, this is something the world should thank them for.

Now, “evil” Google. This company is actually one of the great benefactors of Mankind in the 21st Century. Consider all it currently offers us for free:

Anybody got a blog?


Free e-mail; 15Gb of space to store documents; a road atlas, videos, a search engine, knowledge at your fingertips; translation. Google gives that to every citizen of Britain, to every citizen of the world for free, but Margaret Hodge isn’t satisfied, she wants Google to pay the British Government for the privilege, so that it can use this money to pay the banks the interest on the debt that these same banks have conjured up out of thin air.

Incidentally, Google have attended the last 3 Bilderberg meetings; Tesco have not.

Now, if we can persuade companies like Google to pressurise our governments into taking the power to create credit away from the banks, and give it to the real wealth creators – ie them, where would that leave us?

It would leave us with no national debt, or a very much reduced one, it would mean too an increase in real investment, and stripping the power from the banks. Last month, the Royal Bank of Scotland posted losses in excess of £8 billion, and at the same time set aside over £570 million for staff bonuses. (5) That is one Hell of a gravy train. No regular company could do that, be it a supermarket, a technology giant, or anything else. This shows the immense power of the corrupt system of usury. Once that power is gone, and banks are reduced to strongrooming and bookkeeping, the whole edifice will collapse. Taxation, the Draconian laws that go with it, and the odious men and women who enforce them, the lot.

Investment banking, so-called, is primarily about speculation, in other words, gambling. It makes money, but nothing of value. In the UK, a lot of this is to do with property speculation, and with ludicrious financial instruments such as derivatives, including futures. Some of them even sound suspicious – credit default swaps. Would you really want to buy a product called a credit default swap, seriously?

Once all this nonsense is abolished, all this gambling, and investment goes into real goods and services, including capital goods, we will see stabilising prices, even falling prices, in the UK and indeed throughout the world.

The new real investment, especially in the IT sector, will have far reaching ramifications that will improve all our lives. It will lead to the development of machines that a short while ago sounded futuristic, but which are already being marketed now. Are you all familiar with the new 3-D printing?

There was some controversy last year when someone in Texas produced a blueprint for a printed gun, one that works. That will create nightmares for law enforcement agencies worldwide, but one of the most fantastic future applications of 3-D printing will be transplant surgery, the printing of human organs, believe it or not, they are expecting to print the first such human organs the liver this year. That will mean the end of transplant surgery as we know it.

Our every day lives will be affected in less sensational but more profound ways. 3-D printing applied to electronics will mean eventually that devices which today are still relatively expensive will be absurdly cheap. Imagine printing a mobile phone for a pound or two, and other consumer goods. Imagine the societal ramifications this would have. Certain types of theft would all but disappear. Even the dumbest n...nitwit wouldn’t mug a woman for her phone when he could print one for the price of a cup of coffee.

I will end by saying that thanks to the Internet, millions of people across a broad political spectrum realise now what is wrong with the current financial system. Thirty, twenty or even ten years ago, ideas that were regarded as cranky are now widely accept. There is a downside to that, of course, we’ve now got an endless stream of idiots churning out all manner of conspiracy garbage, not to mention fantasies about the partriarchy, black civilisations of the past, white privilege, and the latest form of racism, but a growing number of people including blacks are beginning to realise that if not quite all the problems in the world can be traced to the financial system, that destroying rather than reforming it is the only way to build a better world. And the way to do that, in my humble opinion, is as I said to take the power to create credit away from those who produce nothing, and give it to the people who control the medium that now both dominates and serves us all.

The Internet is a worldwide phenomenon, but unlike the banking system which consolidates power, it has the ability to diffuse both power and finance, and thereby to hand us all back the power to control our own lives.

To Notes And References

Back To Speeches Index
Back To Site Index