Hearing on Monetary Reform in Holland

The October 14, 2015 hearing at the finance commission of the Dutch parliament regarding monetary reform was a milestone for the Dutch and international movement. The 140 minute long hearing can be watched on-line and will soon be provided with English subtitles [1]. This momentous event was triggered by a citizens’ initiative by  the Dutch monetary reform organization Ons Geld (Our Money) and the satirical theater group De Verleiders (The Seducers), which gathered more than 100,000 signatures, comfortably over the 40,000 needed. The first panel at the hearing, comprised of members of the citizens’ initiative, gave a very clear exposition of its proposals and during the second panel, comprised of financial authorities, bankers and academics, an outstanding debate developed between Dr. Bezemer and Dr. van Egmond about the necessity of reform.

Van Egmond made some very clear and passionate points in favor of reform. He seems to be totally on board with the monetary reform agenda, which is a great boon as he is not only a respected sustainability scholar, but also a founding member of the Sustainable Finance Lab at the University of Utrecht and, most importantly, a member of the very influential Dutch advisory council De Sociaal-Economische Raad (The Social-Economic Council).

Actually van Egmond co-wrote a working paper with Dr. de Vries titled “Dynamics of a sustainable financial-economic system”[7], which presents a “dynamic simulation model” in which the recent research into the nature of bank credit money by Dr. Werner [9,10] is incorporated.

“The model provides the ‘laboratory’ setting in which the discontinuities and associated socio-economic un-sustainability of the current financial-economic system can be studied and the feasibility of more sustainable alternatives can be explored”[7].

As far as I know the paper by van Egmond and de Vries is the third one to model the sovereign money proposal after the papers by Drs. Benes and Kumhof at the IMF [6] and Dr. Yamaguchi from Japan [11]. They all come to very positive conclusions regarding the proposal.

To be complete, there does exist a very recent fourth paper by Drs. Van Suntum and Neugebauer of the Center for Applied Economics Muenster, Germany. They investigated and modeled the Swiss sovereign money proposal and concluded that it was promising way more than could be realistically expected, even stating that “[m]ost of its desired effects are either negative or wishful thinking”[8].

In a response Dr. Huber, a long-time advocate of sovereign money [2] and critic of its alternatives [3,4], challenges the assumptions on which the authors had based their model, especially their idea that sovereign money would just be added to the already existing pool of money, instead of realizing that “Sovereign money – in its original and proper meaning – is a replacement for bankmoney, not an addition to the existing quantities of bankmoney”[5].

Govert Schuller
Naperville, October 20, 2015


[1]. “Round table conversation on the money system”. 2015. Hearing at the Permanent Commission on Finance of the Second Chamber of the States General of the Netherlands. Troelstra Hall. 14 Oct 2015. https://www.youtube.com/watch?v=3TSb9gBdyVE

[2]. Huber, Joseph & Robertson, James. 2000. Creating New Money. London: New Economics Foundation.

[3]. Huber, Joseph. 2014a. “Modern Money Theory and New Currency Theory”. Real-world economics review 66, (13 January 2014): 38-57. http://www.paecon.net/PAEReview/issue66/Huber66.pdf

[4]. Huber, Joseph. 2014b. “Sovereign Money in Critical Context: Responding to criticism of monetary reform from a variety of economic viewpoints”. Source: sovereignmoney.eu/papers-and-manuscripts, Oct 2014. http://www.sovereignmoney.eu/sovereign-money-in-critical-context

[5]. Huber, Joseph. 2015. “Side notes to” van Suntum, Ulrich & Neugebauer, Tom. 2015. Link to note at http://www.sovereignmoney.eu/confronting-criticism/.

[6]. Kumhof, Michael & Benes, Jaromir. 2012. “The Chicago Plan Revisited”. IMF Working Papers 12/202, International Monetary Fund. http://www.imf.org/external/pubs/ft/wp/2012/wp12202.pdf

[7]. Van Egmond, N.D. &  de Vries, B.J.M . 2015. “Dynamics of a sustainable financial-economic system”. Sustainable Finance Lab Working Paper. http://sustainablefinancelab.nl/files/2015/04/SFM-working-paper.pdf

[8]. van Suntum, Ulrich & Neugebauer, Tom. 2015. “Vollgeld, Public Debt, and the Natural Rate of Interest”. Working Paper, Centrum für Angewandte Wirtschaftsforschung Münster (CAWM), June 2015. Link to paper at http://www.sovereignmoney.eu/confronting-criticism/.

[9]. Werner, Richard A. 2014a. “Can banks individually create money out of nothing? The theories and the empirical evidence”. International Review of Financial Analysis, 36 (2014): 1–19. http://www.sciencedirect.com/science/article/pii/S1057521914001070

[10]. Werner, Richard A. 2014b. “How do banks create money, and why can other firms not do the same? An explanation for the coexistence of lending and deposit-taking”. International Review of Financial Analysis, 36 (2014): 71–77. http://www.sciencedirect.com/science/article/pii/S1057521914001434

[11]. Yamaguchi, Kaoru. 2011. “Workings of a Public Money System of Open Macroeconomies: Modeling the American Monetary Act Completed”. In Proceedings of the 29th International Conference of the System Dynamics Society, Washington D.C., USA, 2011. The System Dynamics Society. http://monetary.org/wp-content/uploads/2011/11/DesignOpenMacro.pdf

3 Responses to “Hearing on Monetary Reform in Holland”

  1. joe bongiovanni

    Thanks, Govert.
    Suffice to say that the jig is up on private debt-based money systems, and the cat is already out of the bag in favor of public, debt-free money issuance, as indicated in each of your referenced notes.
    Overcoming a hundred years of business school failure to come to this understanding means that there will be a deepening of the prevailing money dialogue and the resistance of the monied interests with the power over our democratic societies.
    We will ultimately prevail, of course.
    Sovereign money systems will occupy the Commons of national economies in the coming days, as the understanding spreads that basing money upon private debt issuance is a dead man walking, in the political-economy of the future.
    I await the English sub-titled version, and to what comes next.

  2. J E van Tuinen

    Island,Switserland,Holland.is democratie saving us from the nefast consequences of our banking system?


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