Healthy Money Healthy Planet - library.uniteddiversity.coop

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is afflicted with all the defects inherent in our products. Our goods rot, decay, break, rust, so only if
money has equally disagreeable, loss­involving properties can it effect exchange rapidly, securely and
cheaply. For such money can never, on any account, be preferred by anyone to goods.
Only money that goes out of date like a newspaper, rots like potatoes, rusts like iron,
evaporates like ether, is capable of standing the test as an instrument for the exchange of potatoes,
newspapers, iron and ether. For such money is not preferred to goods either by the purchaser or the
seller. We then part with our goods for money only because we need the money as a means of
exchange, not because we expect an advantage from possession of the money.
So we must make money worse as a commodity if we wish to make it better as a medium of
exchange.
Gesell believed that money is an invention designed to perform its main function – that of
a medium of exchange. He also believed that money doesn’t need to be a store of value
because this is totally against the natural economic order.
are that:
According to Gesell, the criteria for money to be an efficient instrument of exchange
1. It will secure the exchange of goods – effectively judged by the absence of trade
depressions, crises and unemployment.
2. It will accelerate exchange – as judged by the reduction in stocks of goods, the decrease
in numbers of merchants and shops, and the correspondingly fuller store rooms of the
consumers.
3. It will make the exchange of goods cheaper – as judged by the small difference between
the price obtained by the producer and the price paid by the consumer.
Potential Effects of Gesell’s System
Gesell believed that introducing money with a circulation incentive would have farreaching
effects. For a start, once it came into use, his suggested ‘parking fee’ would ensure