Money As Debt

My friend Anita brought this video to my attention. I have never studied economics but have been trying to learn more about it for my work at the UN.

Paul Grignon’s 47-minute animated presentation of “Money as Debt” tells in very simple and effective graphic terms what money is and how it is being created.

Grignon explains that banks create money by making loans, that our monetary system is sustained only by continual growth and that less debt means less available money.

The video left me with a few thoughts.

One of the greatest problems facing developing countries is debt. Most of these countries are unable to meet the basic needs of their people because a large percentage of their income has to go toward servicing this debt. What would happen if these debts were canceled as many activists call for? I wonder, who would benefit and who would be hurt?

If our present monetary system is dependent on continual growth, what are the implications for climate change? Wouldn’t slower growth be better for the planet?

The video made me think about Aldous Huxley’s Brave New World which I reread last month. It’s a novel about a future where the central value is consumerism. In this world everything that doesn’t contribute to consumer behavior is done away with. The great cultural treasures of the past like the pyramids and the Mona Lisa have been destroyed. The Bible and Shakespeare are banned and only pastimes that require people to buy something are allowed. Even people are mass produced and then conditioned from infancy to consume. Anyone who dissents from the system is doped up or banished because the system will collapse if people stop consuming. They have to keep running on a meaningless hamster wheel.

Grignon suggests some alternatives to our present monetary system that are more positively sustainable in his video and I think people should think about them before we end up in a “brave new world.”


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