I am quite certain that the key to managing currency is to require rental/privilege payments in the currency. If the economy grows with increasing trade then the government (or other public entity) could simply issue new incremental amounts of currency to the public on a per-capita basis rather than allowing privileged interests to issue new debt. Part of the proof of how currency is strengthened by requiring rent to be paid in the currency is to be found in the unnatural strength of the dollar. The USA requires (at gun point) the payment for oil and other commoditites to be made in dollars. The perverse effects are to weaken US manufacturers (mostly) while allowing the country as a whole to import foreign products without exporting an equivalent value of products. (But hey, we aren't really an empire, are we?)
It seems that we also need different levels of currency for example a separate international currency for trading in world based commodities like oil and CO2. The rent so collected could be used for international projects or rebated back to individuals across the globe. All of us heavy CO2 users would have to compensate the injured. It might change some behaviors....
I havent' posted in a while because blogging was taking up too much of my time. Back to work.....
The rent so collected could be used for international projects or rebated back to individuals across the globe. All of us heavy CO2 users would have to compensate the injured. It might change some behaviors....
As the guy said... "If you want to keep a donkey healthy, you don't regulate what comes out of it: you regulate what goes in."
Oil has the intrinsic value of carbon energy and may therefore easily be "monetised" by creating Units redeemable in energy: CO2 has no intrinsic value whatever, and can only be monetised by "fiat".
But you must burn Carbon to get CO2.
My proposal is that a Carbon levy (tax on privilege) would be used to create a Carbon "Energy Pool".
Stage One:
"Unitise" the pool into - say - 10 Kilo Watt Hour Units, which may be termed "Carbon Dollars".
So at a "launch" market price of US$0.10 per kwH, a Carbon Dollar "Unit" would actually equate to US $1.00. The US $ would thereafter diverge from (ie in all likelihood devalue against) Carbon dollars
Stage Two
Let's start with a Pool of 100m Carbon Dollars valued at $100m.
Invest the $ funds in the Pool in:
(a) "MegaWatts" from renewable energy projects - on the basis that this energy investment is repaid by production of the project "sold forward" to the Pool;
(b) "NegaWatts" from energy efficiency savings, on the basis that the energy investment in Carbon Dollar terms is repaid out of energy savings.
So a 1 Mw wind turbine which costs $2m is funded by selling forward 2m Units (Carbon Dollars) at $1.00 each. ie 20,000 Mega Watt Hours, or 20,000 hours of production, which over a 20 year life is 1000 hours per year.
It then depends how many hours per year the turbine produces electricity (after putting operating costs to one side) as to how quickly this investment will be paid back to the Pool.
The balance of production then remains for distribution as an Energy Dividend.
For energy saving investments in "NegaWatts", the propert(ies) where the savings have been made could be billed by the Pool for repayment of x Energy Units/ Carbon Dollars per year at the prevailing exchange rate of Carbon Dollars/ Energy Units in US $.
Stage Three Distribute equitably the 100 million Carbon Dollars/ redeemable Units in the Pool.
Recipients could: pay off "Energy Loans"; use the Carbon Dollars against energy consumed; or more likely exchange them for something else of value at a "market price".
In all likelihood, a large proportion of Carbon Dollars would remain outstanding, and the Pool would therefore be able to benefit from "seigniorage".
As with any other monetary system, the Pool would have to be managed to prevent inflation or defaults, but its basis will be in energy - which has intrinsic value - distinguishing it from US $, or Carbon Credits, which have no intrinsic value. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
