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Money makes
the world go round. There's no denying that. Money has given
humankind a medium of exchange that does not require us to barter or steal to
satisfy our needs. But the quality of that money and the terms by which it is
acquired affect the quality of our lives. The value of our money is determined
by a simple equation that compares the amount of money against the amount of
wealth available. This is, of course, quite an oversimplification, as the
"velocity" of money affects its value and purchasing power, just as the amount
of goods put on market for sale affect their value. In short, the more money,
or the faster the money is used, the lower its value. Likewise, the more
wealth, or the more wealth put on the market for sale, the less its value in
dollar terms. The Value of Money (VM) equals the amount of Money
(M) divided by the amount of Wealth (W). VM=M/W. In the present economic
system, this relationship is constantly changing. These changes are reflected
in the Consumer Price Index, the inflation/deflation rates, and
in foreign exchange relationships.
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Towards a Sustainable Economy
In order for an economic system to be truly sustainable,
several things must occur. Firstly, the rate of consumption must not exceed
the rate of production. Secondly, the money supply must maintain a fixed
relationship to the wealth or resource supply. In other words, the value of
money must remain stable and secure, with no inflation and no deflation. Only
in such an environment will the general public make wise and prudent decisions
in the use of resources. Government can employ consumption taxes at some
level to ensure that this balance is maintained, reducing or eliminating those
taxes as personal and business investment rises enough to create the necessary
surplus able to fund all government services.
At present, we are riding a roller-coaster of
inflation-deflation cycles in which only the rich prosper at the expense of
everyone else. It is the act of income taxation that is largely responsible
for this as the real motivating force behind the enforced debt slavery now being
experienced by most governments and most individuals. Consequently, we will
never have a sustainable economy, a sustainable government, or sustainable
lifestyles until income taxes are completely eliminated, and government takes
over from the banks the issue of new money minus any built-in interest charges.
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