Healthy Money Healthy Planet - library.uniteddiversity.coop

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perhaps the most astounding piece of sleight of hand that has ever been invented.
Banking was conceived in iniquity and born in sin. Bankers own the earth; take it always
from them, but leave them with the power to create credit, and with the stroke of a pen
they will create enough money to buy it back again … If you want to be slaves of the
bankers, and pay the costs of your own slavery, then let the banks create money.’ 44
Even in New Zealand we have had official confirmation that banks create our
money. The Royal Commission on Banking and Credit, chaired by Justice Tindall in 1956,
reported that banks create credit but that it is a normal function of a bank to do so, as
banks are banks of issue as well as banks of deposit. 45 More recently, after a great deal of
preliminary discussion with New Zealand Banking Reform (a pressure group that existed
for two years around 2000 to help reveal how money is created), Michael Reddell, chief
manager of the Financial Markets Department, Reserve Bank of New Zealand, confirmed
that, ‘More than 98% of the M3 measure of the New Zealand money supply has been
created by registered banks.’ 46
What about economists, couldn’t they have told us the truth of the matter? Well, so
pervasive is the university teaching about the role of interest, and so unquestioned is the
right of banks to create the bulk of the money supply at interest, that it is rare to find an
economist who is willing to entertain the possibility that the textbooks may need
rewriting. And when banks sponsor university departments, how can they claim to be
truly independent? Essentially, university economics courses subscribe to the orthodoxy.
When asked how New Zealand’s total debt has increased beyond the country’s GDP with
no sign of a reduction, economists will often respond by saying that New Zealanders are
living beyond their means.
Between 2000 and 2002, in my role as a member of New Zealand Banking Reform, I
had discussions with many economists. One of the few whose insights were helpful in
this search for meaning was John Lepper, economic advisor to the Rt. Hon. Jim Anderton,