Down with the Monetary Overlordship!

liberating money for ‘the people’ from the lenders

Stephen Yearwood
10 min readJul 31, 2022
Photo by micheile dot com on Unsplash

We owe very our lives to the lending overlords. That is not polemic rhetoric. It is not hyperbole. It is, we’ll see, a fact of life in the existing economic system in its current iteration.

It is also, for me, a frightening thought. I’m not suggesting evil intent on the part of those who hold the levers of that power. Even so, over the course of history that kind of power in the hands of any human beings has not boded well for ‘the people’.

Already, now that banks, for the sake of their liberty (deregulation), are free to pursue profits by means of speculation, lending to individuals and small businesses has become a superfluous inconvenience. Us ‘people’ are forced to turn to easily obtained credit cards — and worse options — with usurious rates of lending. The worse our financial situation gets, the worse our options get.

“Money,” it has been said, “makes the world go ‘round.” For sure, it allows the existing economic system to function. (Like fuel in an engine, it doesn’t of itself make the economy ‘go’, but is necessary for it to ‘go’.)

Specifically, the economy functions via money in the form of income. Income is money that is acquired in any way other than borrowing it. (Just ask the IRS.)

Money is created through borrowing. Borrowing from lenders adds to the amount of money circulating in the economy because they don’t part with the money they have on hand, but ‘extend credit’ to borrowers. That credit is then used as money (with an equal amount of money returned to the lender over time — plus interest, of course). Money can also be created when the central government ‘borrows’ money. The central government borrows money by ‘issuing’ debt. By law, the central bank is required to see to it that all of that debt is purchased. It is perfectly legal for money to be created, by the central bank and the central government acting in concert, for the central bank to use to buy newly issued debt of the central government. When that is done that is an increase in the amount of currency. Money in the form of debt owed to lenders plus money in the form of currency equals the total money supply (with the latter historically being by far the smaller proportion of the total).

Producing and acquiring goods and services turns money into income. The only reason money is borrowed is to use it for the production/acquisition of goods and services (which is as true for government as it is for businesses and individuals).

[A slash is used to indicate the indivisibility of the two sides of the economic coin: the acquisition of goods and services is inevitably involved in the production of goods and services that are in turn, the producer hopes, acquired. In the production/acquisition of goods and services in the existing economy of any nation, money facilitates the exchanges involved for of all that to transpire.]

When money gets transferred in that process it becomes income for whatever entity receives it. That income is then used to produce/acquire more goods and services — and the economy goes ‘round and ‘round.

The point is that all money received by any entity as income is borrowed money. This being economics, the inevitable exception will be discussed below, but make no mistake: borrowing/lending is the heartless pump of the existing economy. It is how money gets into the economy; money returned to lenders in the form of repayments gets recirculated through more borrowing. Borrowed money being passed from one entity to another via exchanges of all kinds is what income is.

Income is needed for people to acquire the goods and services necessary to survive physically, much less have any more than that. The conclusion is that in the economy as it currently exists in any nation borrowing is necessary for life itself to continue.

[That makes lenders the overlords of most nations. The exceptions would be nations in which the government owns the banks (and has decisive control over any private banks that do exist). In those nations either some Party (ideological or theological) or individual tyrant has control over the lending system along with everything else. So where lenders are not the overlords those who have overt authority over the lenders are.]

I propose ending the debt-based overlordship. I propose we do that by having money enter the economy in the form of an income for individuals and the funding for government (all government, from central to local) without involving taxes and without involving borrowing.

Many questions arise. I have answered them all. This is not an idea I came up with this morning. I have been developing this proposal for some time. There are links below for further reading, but I’ll add a tad more information here.

the basic idea

The money for that income would be created as needed. It would be paid to retirees and adults unable to work, no matter what. From there, it could be a guaranteed minimum income for people employed in any business or government or (my preference) it could be the income for everyone employed in any business or government. The amount of it is to be determined, but the idea is for it to be sufficient for a decent life. In the U.S. at present I would make it $15/hr.; $600/wk. (which without taxes would be like at least $18/hr.: $720/wk. today) if it were the former and $25/hr./; $1,000/wk. if it were the latter. Either way, any (adult) citizen could become eligible for it. Further compensation in the form of benefits would still exist in either case (as employers would find themselves competing for employees — rather than people competing for employment, as at present).

For the individual citizens who were eligible for that income, it would be bulletproof. Nothing could threaten it. Once instituted, it would be outside the control of any person, committee, or organization. No matter what was happening with the economy, that income would never be at any risk.

The same would be true for the funding for government. It would also be created as needed. I would set it at the current per capita level of total government spending, so it would adjust automatically to changes in the population of the nation — and only that — with no person, committee, or organization having any say in what the amount of the funding for government would be. (It must be noted that ‘officially’ determining merely the size of the population would thereby become a focused target of politics.)

The total of that income paid to individuals and the money provided for government would be the supply of money, as currency, for the economy. Private borrowing would continue as at present, perhaps adding to the money supply (if lending exceeded repayments), perhaps reducing it (if the other way around), but it would no longer be the primary source of money for the economy. More importantly, borrowing itself would no longer be the only (regular) source of money for the economy and, ultimately, income for all citizens.


When I first came up with the idea of such an income I seriously doubted its feasibility. I thought, though, that it would be worth considering. I knew right away that for the proposal to be viable both politically and economically it would have to have built-in protections against inflation, as opposed to having the central government and/or the central bank attempting to control the price level. It soon occurred to me that the same process involved in administering that income could be used to fund government. I learned that those two streams of money entering the economy, in the way I proposed, would make the existing economy stably self-regulating with no unemployment, poverty, taxes or public debt and increased sustainability (because total output would be governed, passively but effectively, by demographics).

So to my surprise, the more I learned about this proposal, the more viable it became. I eventually realized that the economic validity of this idea comes from the fact that it solves the fundamental flaw in the existing economic system.

In the economy as we know it, all of the variables in it — employment, interest rates, total income, the collection of taxes (at whatever rates exist), the size of the money supply, etc. — are interdependent: each affects all others and is in turn affected by all others. That makes the economy inherently unstable: it cannot possibly achieve a stable equilibrium. It will always be tending towards contraction (recession/depression), i.e., less output/less employment/lower prices, or expansion, i.e., more output/more employment/higher prices (up to and including hyperinflation)—or ‘stagflation’: both less output and higher prices. Since the Great Depression we have depended on a partnership between the central government and the central bank to ‘manage’ the economy to at least keep the worst from occurring.

This proposal, it turns out, solves that problem. It does that by making the supply of money (as currency) independent of the rest of the economy. It becomes, in the jargon of economists, an ‘exogenous variable’. It still varies in its amount over time, but that variance has nothing to do with what is happening in the rest of the economy or the actions of any single entity within it. Given the importance of money to the economy, making the supply of currency as large as this proposal makes it and making the amount of it an exogenous variable (determined only by demographics) and having that money enter the economy without involving debt in the way it does in the proposal, with the built-in protections against inflation that exist in it, would make the economy stably self-regulating, with all of the other aforementioned outcomes always existing. (Actually taxes/public debt would still be possible, for added spending, but that is a separate issue: no taxes or public debt would ever be needed for the existing per capita level of total government spending to continue forever.)

That is why you can ‘take this idea to the bank’, as the saying goes. That it solves that fundamental economic problem establishes beyond doubt its economic validity.

not really anything new

Finally, this idea is actually not revolutionary, in the sense of being something totally new and different. Something like it has already been done in recent years. It has been called ‘quantitative easing’ (QE). That is the exception to debt as the only source of money mentioned earlier in this essay. In the existing economy QE is an irregular — some insist, illegal — source of money (as currency).

QE was invented — or at least used on a significant scale for the first time — as a response to the economic crash that occurred in 2008. Money was created (as currency) without the creation of debt. Before, money created ‘out of thin air’ had only been used (in any significant amount) to purchase newly issued debt of the central government. In QE that money was used by the central bank, on a huge scale, to purchase existing debt. That was a revolutionary act.

That money went to the entities holding a load of debt that was so vast and so complex in its interdependent structuring (using ‘derivatives’) that it was literally the case that none of them had any idea what any of it was worth (as it put me in mind of a line from “All Along The Watchtower,” by Bob Dylan). Greed had sucked the entire financial system into that vortex of speculation. When everyone involved suddenly realized that it had all gotten so convoluted that the basic information on which the process depended was a complete unknown — i.e., the value, measured in money, of the multifarious forms of debt obligations that were being created — the process simply stopped: the creation and selling/buying/swapping of ‘securities’ (cough), which had become the essence of what the financial sector was, could not proceed. That one bit of information, that the concept of value had gotten lost, hit the financial sector like “ice-nine” hitting water (thank you, Kurt Vonnegut, Jr.: Cat’s Cradle). Finance didn’t so much freeze up as it underwent a phase shift to a solid state: all movement (other than the repayment of debts by suckers who were able and willing to continue to honor our moral obligations) came to an abrupt halt.

So, anyway, money was created so the central bank could ‘swap’ it for large portions of that debt at some made-up ‘exchange value’ so the financial sector could start moving again. Even after the basic crisis had been resolved, central banks continued for years to give literally free money (as newly created currency) to entities like banks, insurance companies, and ‘hedge funds’ (as the sobriquet implies, the centerpieces of the debacle) in exchange for pieces of paper with no known value. That was QE as we have known it.

big finish

My proposal gives literally free money to eligible citizens and uses such money to fund all government, based on the size of the population of the nation. So this would be a kind of permanent ‘quantitative easing’ for ‘the people’. It would be made explicitly legal via a legislative Act — and, in a nice bit of irony, the existing banking system could be required to administer it on behalf of the people (though it could otherwise be administered by a newly created Monetary Entity).

That money would be liberated from the monetary overlords. As I propose doing that it would, as noted, make the existing economy stably self-regulating while eliminating unemployment, poverty, taxes, and public debt and increasing sustainability. It would accomplish all of that at no cost to employers, without redistributing anything, without imposing any limit on income/wealth, and without requiring people to act any particular way.

In short, there is no reason for anyone to oppose this proposal. Some people might not like the absence of punishment in it. Given all it would achieve, however, including most of all freeing us from total dependence on the monetary overlords, as I like to say, surely celebrations are in order.


Want more information? “Same Economy, Way Better Outcomes for Society;” (primarily for economists) “Paradigm Shift;” and (for those who think, as I do, that we should — must, due to the requirements of both justice and, at this point, sustainability — take the idea of a democratically distributed income far as possible) “To Preserve What We Have, What We Have Must Be Enough” are all here in Medium, but not behind the paywall. Anyone reading this can understand this New Monetary Paradigm (if some more easily than others).



Stephen Yearwood

unaffiliated, non-ideological, unpaid: M.A. in political economy (where philosophy and economics intersect) with a focus in money/distributive justice