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Global Financial Reform: Breaking Free from the Money Scam
Markets distorted by concentrated wealth do not serve the common good. They serve the already rich.
Jul 05, 2025
The $34 trillion U.S. federal debt cannot be eliminated so long as private bankers control money production and profit from interest on money they create from nothing. This column puts this issue in a global perspective.
Most of the U.S. federal debt arises when the U.S. government borrows from private bankers by selling them Treasury bonds and other financial instruments. A banker opens an account in the government’s name and enters the amount of the bond. With a few keystrokes, the banker creates expendable currency for the government’s use. The government is expected to repay the bank for the principal when due, plus interest.
When the bond principal is repaid, that money disappears, but no money has been created to pay the interest. Thus, the accumulating interest creates a perpetually growing government debt spiral.
Private bankers collect interest in perpetuity on money that could just as easily have been created by national governments interest-free with no need for repayment.
The Privatized Financial Commons
In modern society, nearly everyone depends on money to meet their basic needs through transactions in the productive economy. In this sense, the money supply that serves the productive economy functions as a global commons—a shared resource essential to life in the modern world. Like any commons, it should be subject to democratic governance and managed for the common good.
This is more than economic injustice. It is a recipe for global breakdown.
The world’s productive economy relies on a limited pool of liquid money—what economists call the M2 money supply. This includes physical currency, checking accounts, savings deposits, and other readily spendable bank holdings. As of 2025, global M2 is estimated at approximately $93 trillion. It represents the total stock of money available at any moment for real economy activity—paying wages, buying groceries, building homes, funding schools and hospitals, and much more.
Over 90% of the global M2 is created not by governments, but by private banks issuing loans. Most of the money the world’s people depend on for their living is interest-bearing debt owed to private banks that created it from nothing.
Beyond this limited pool of money circulating in the productive economy lies a vastly larger financial universe—over $500 trillion in non-cash financial assets: stocks, bonds, derivatives, and cryptocurrencies. These cannot be used directly to buy goods and services. To be used in the productive economy, they must be sold and thus converted into spendable money—into M2 cash.
Most of these assets are fictitious, created not to support productive activity, but rather to extract speculative profit from the productive economy. This vast pool of fictitious assets actively directs attention of investors away from supporting the work of the real economy.
Fictitious Wealth, Real Harm
The non-cash financial assets—especially derivatives, leveraged buyouts, and cryptocurrencies—serve only the already wealthy seeking to extract unearned wealth from the productive economy without doing or producing anything in return that might benefit society.
This parasitic financial system generates massive profits for the few while inflicting widespread harm on the many. Its consequences include:
- Eroding democracy, as financial elites gain disproportionate influence over governments and public institutions.
- Driving inequality, enriching those who already own assets while leaving the rest to borrow at usurious interest rates just to survive.
- Starving the real economy—where people grow food, care for children and elders, build infrastructure, and heal the sick—of stable, affordable financing.
- Fueling financial instability, as speculative bubbles repeatedly inflate and burst.
- Accelerating ecological collapse by prioritizing short-term gain over planetary survival.
Governments that could issue their own currency—interest-free and debt-free—instead borrow from private banks, thus redirecting public funds to pay interest on private loans. The result is a transfer of power and wealth from the many to the few, underwritten by public debt and justified by economic myths.
A System Justified by Myth
The defenders of the current financial system insist it promotes efficiency and innovation by letting “free markets” allocate capital. But markets distorted by concentrated wealth do not serve the common good. They serve the already rich.
Private banks lend primarily to those who already have substantial assets—speculators, real estate developers, and large corporations. They dismiss community-serving or ecologically restorative projects as “too risky” or “insufficiently profitable.”
A just and sustainable future begins with liberating ourselves from the tyranny of private money creation.
The result? A system in which the wealthy borrow cheaply to amass more wealth, while the poor pay high interest—if they can borrow at all. Local communities and vital ecosystems are left underfunded and vulnerable.
This is more than economic injustice. It is a recipe for global breakdown:
- Billionaires launch themselves into space while the poor go hungry.
- A debt-driven growth imperative accelerates extraction from Earth just to service unpayable loans.
- Financial imperialism traps nations in dependency and fuels geopolitical conflict.
- Governments that borrow their own currency become debt slaves—not sovereign democracies.
Begin with Public Education and Democratic Dialogue
Transforming this deeply entrenched system cannot be left to backroom negotiations, technical fixes, or elite commissions. Real change must begin with a broad, inclusive public conversation grounded in honest education and democratic engagement.
Most people have no idea where money comes from nor how the financial system works. This ignorance is not accidental. Mainstream economics education often obscures or distorts the process through abstract models and technical jargon that serve the interests of financial elites.
Reform begins with demystification. Citizens must understand how money is currently created and who benefits. They must also understand how we can change the way money is created so it serves public—not private—purpose. This awakening will require the leadership of independent media, educators, grassroots movements, public servants, and faith leaders committed to truth and justice. It must reach across generations, communities, and ideologies to ignite the public imagination.
A new conversation about money is foundational. Without it, movements for economic justice, environmental regeneration, or democratic renewal will remain trapped within the constraints of a system rigged against them.
Then, Reclaim the Public Power to Create and Govern Money
Once the broad public understands how money is created—and who benefits—we must take the next step: reclaim the power to create and govern money as a public function, accountable to democratic institutions.
This means:
- Transferring the power to create money from private banks to public institutions designed to serve the common good.
- Establishing an independent, transparent, democratically accountable body to regulate money creation—ensuring enough is created to meet real needs, but not so much as to fuel inflation.
- Creating public banks, credit unions, and community-rooted financial institutions that circulate money locally to support the meeting of real needs, while resisting speculative extraction.
- Curtail financial speculation by strictly regulating—or abolishing—predatory financial instruments like derivatives, leveraged buyouts, and crypto schemes.
- Using public money creation to fund health care, education, affordable housing, infrastructure, and ecological regeneration—rather than speculative profits.
In a healthy economy, money serves life. It facilitates the exchange of real goods and services. It connects people in mutual caring relationships. In such an economy, billionaires would not exist, because the mechanisms that currently create extreme wealth would be replaced with mechanisms that secure the well-being of all.
We should expect fierce resistance from those who profit from the current system. But there will be no refuge on a dying Earth—and there is no planet B. In the end, all but the most self-delusional will come to understand that their own survival depends on a living planet and a just society.
We should expect fierce resistance from those who profit from the current system. But there will be no refuge on a dying Earth—and there is no planet B.
From Illusion to Liberation
To reclaim our future, we must reassert the public’s right to create and govern money as a democratic instrument of shared well-being—not private wealth accumulation.
We will not end war while private financiers profit from war. We will not end poverty while public wealth is siphoned into private interest payments. We will not stop environmental collapse while debt-fueled growth drives relentless extraction. And we will not build an Ecological Civilization until we dismantle the financial system that feeds on life rather than serving it.
A just and sustainable future begins with liberating ourselves from the tyranny of private money creation. To build a just and sustainable future, we must make financial education and reform a priority of every social movement advocating for peace, justice, and a healthy living Earth.
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'Start Over From Scratch': Nobel Laureate Economists Denounce GOP Budget Bill
"The House bill addresses none of the nation's key economic challenges usefully and exacerbates many of them."
Jun 02, 2025
Half a dozen Nobel Prize-winning economists on Monday expressed their "grave concerns" about the sprawling budget reconciliation package passed last month by the Republican-controlled U.S. House of Representatives, warning that slashing an already frayed social safety net and exploding the record deficit in service of massive tax cuts for the wealthiest households will worsen the nation's economic woes.
"The most acute and immediate damage stemming from this bill would be felt by the millions of American families losing key safety net protections like Medicaid and Supplemental Nutrition Assistance Program (SNAP) benefits," Daron Acemoglu, Peter Diamond, Oliver Hart, Simon Johnson, Paul Krugman, and Joseph Stiglitz wrote in an open letter published by the Economic Policy Institute (EPI), a progressive think tank in Washington, D.C.
"The Medicaid cuts constitute a sad step backward in the nation's commitment to providing access to healthcare for all," the economists continued. "Proponents of the House bill often claim that these Medicaid cuts can be achieved simply by imposing work reporting requirements on healthy, working-age adults. But healthy, working-age adults are by definition not heavy consumers of health spending, so achieving the budgeted Medicaid cuts will obviously harm others as well."
🚨NEW: 6 Nobel laureate economists signed an open letter opposing the House budget bill 🚨 The bill adds significantly to the national debt while reducing incomes for the bottom 40%, they say. The most acute & immediate damage? Millions losing Medicaid & SNAP benefits: www.epi.org/publication/...
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— Economic Policy Institute (@epi.org) June 2, 2025 at 10:16 AM
Addressing the bill's staggering impact on public debt, the letter asserts that "U.S. structural deficits are already too high, with real debt service payments approaching their historic highs in the past year."
"The House bill layers $3.8 trillion in additional tax cuts ($5.3 trillion if all provisions are made permanent) on top of these existing fiscal gaps—and these tax cuts are overwhelmingly tilted toward the highest-income households," the Nobel laureates noted. "Even with the safety net cuts, the House bill leads to public debt rising by over $3 trillion in coming years (and over $5 trillion over the next decade if provisions are made permanent rather than phasing out). The higher debt and deficits will put noticeable upward pressure on both inflation and interest rates in coming years."
"The combination of cuts to key safety net programs like Medicaid and SNAP and tax cuts disproportionately benefiting higher-income households means that the House budget constitutes an extremely large upward redistribution of income," the economists warned. "Given how much this bill adds to the U.S. debt, it is shocking that it still imposes absolute losses on the bottom 40% of U.S households."
"The United States has a number of pressing economic challenges to address, many of which require a greater level of state capacity to navigate—capacity that will be eroded by large tax cuts," the letter concludes. "The House bill addresses none of the nation's key economic challenges usefully and exacerbates many of them. The Senate should refuse to pass this bill and start over from scratch on the budget."
The so-called Big Beautiful Bill is now in the Senate, where Minority Leader Chuck Schumer (D-N.Y.) has vowed on behalf of Democrats to "fight it with everything we've got."
"The Republican plan is simple: Sell out working and middle-class families to pay off the rich and well-connected," Schumer said in a "dear colleague" letter on Sunday. "The bill would raise costs and taxes by an average of more than $800 for 40% of American families. Twenty million Americans would see their healthcare costs skyrocket, while almost 14 million would lose their health insurance all together, including millions of children and seniors."
Furthermore, Schumer noted that "11 million people, including 4 million children, could lose access to safe and affordable food, while every one of the 40 million Americans receiving federal food assistance would get less support every month. All the while, their radical plan would see double-digit energy cost increases for American households and businesses, and threaten close to 800,000 good-paying jobs in the clean-energy economy."
"Their entire agenda," Schumer said of Republicans, "can be boiled down to this: Billionaires win and families lose."
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Congressional Analysis: GOP Tax Gifts to Rich Would Explode Deficit They Always Complain About
"This bill gives enormous additional tax cuts to wealthy people and corporations, spikes the deficit, and strips healthcare from millions of Americans," said one critic.
May 13, 2025
While Republicans on Capitol Hill—including the leaders of both chambers of Congress—have long argued for reducing the national debt, the GOP is now pushing a tax bill that would not only fund giveaways to the rich by gutting programs that serve the working class, but also add $3.8 trillion to the U.S. deficit.
The national debt is currently $36.2 trillion. The Joint Committee on Taxation (JCT) on Tuesday released an analysis showing that the Republican bill would cost $3.8 trillion through 2034, or 1.1% of gross domestic product.
The JCT document notes that some estimates—such as the impact of modifications to de minimis entry privilege for commercial shipments and to Medicare, including limiting coverage—will be provided by the Congressional Budget Office.
The JCT's release coincides with a key meeting in the U.S. House of Representatives. As Politico detailed:
The newly revised estimate released Tuesday afternoon is up slightly from the $3.7 trillion price tag budget forecasters had previously put on the plan, and it comes as the tax-writing Ways and Means Committee began formally debating the package. Additional changes are possible there, and also later, when Republicans are preparing to take the legislation to the House floor."
[...]
Under the House GOP's budget, the size of their tax cuts is contingent on lawmakers simultaneously cutting spending, and Republicans are hoping to match $4 trillion in tax cuts with $1.5 trillion in spending reductions.
Ahead of the markup, Amy Hanauer, executive director of the Institute on Taxation and Economic Policy (ITEP), said in a statement that "this bill gives enormous additional tax cuts to wealthy people and corporations, spikes the deficit, and strips healthcare from millions of Americans."
"Reckless tax cuts for the top and new corporate loopholes appear to be the big features of this bill, and they're paid for by cutting our healthcare and making American communities more vulnerable to floods, fires, and storms," she stressed. "The revenue raisers—which don't stop this from being extremely expensive—seem to be about picking winners and losers, rather than passing rational, consistent policies."
ITEP's statement also lists the bill's major provisions, including making changes to personal income tax rates and brackets from the GOP's 2017 Tax Cuts and Jobs Act permanent; making permanent and increasing the "pass-through" business deduction; increasing the estate tax exemption; and temporarily increasing the child tax credit, but excluding millions of children.
Americans for Tax Fairness (ATF) similarly listed provisions on social media Tuesday—and highlighted their impacts.
What's the result of maintaining the top income tax rate cut? "25% of the benefits go straight to the top 1%," the group noted. "The average top 1% household makes $2.5 million a year. They would get a $55k tax break. The top 400 taxpayers would get an $800 MILLION tax cut each year."
"Since they're deficit-financing most of this, every penny of the 'savings' DOGE has found... is paying for tax breaks for the wealthy."
What about widening the "pass-through" loophole? "Half of this break goes to millionaires," ATF continued. "The top 0.1% would get a $107,000 tax cut. The top 1% would get an average $22,500 tax cut. Working families would get around $40 to $50. White households get 90% of the benefit."
The group pointed out that "the package doubles how much rich heirs can inherit without paying taxes. That means a couple could pass on $30 MILLION without paying a penny in taxes. This tax break ONLY benefits the richest 0.2% of households. Weakening the estate tax is projected to cost $200 BILLION."
"It also gives corporations $642 BILLION in tax breaks," ATF said. "Most of the benefit of corporate tax cuts goes to CEOs, rich shareholders, and foreign investors. One provision gives Apple, Amazon, Google, Meta, and Tesla alone a $75 BILLION tax cut. Another encourages offshoring."
ATF also tied the proposal to supposed cost-cutting efforts by President Donald Trump's Department of Government Efficiency (DOGE) and its de facto leader, Elon Musk—who also happens to be the CEO of Tesla and the richest man on Earth.
"The part they won't say out loud?" the group wrote. "Since they're deficit-financing most of this, every penny of the 'savings' DOGE has found by cutting the [the Department of Veterans Affairs], Department of Education, and Social Security Administration is paying for tax breaks for the wealthy. Really."
Although Republicans control both chambers and the White House, their majorities are slim, meaning absences and disagreements over issues like increasing the deficit or cuts that will anger constituents in swing districts could slow or even impede their ability to send "one big, beautiful bill" to Trump's desk.
As Common Dreams reported earlier Tuesday, U.S. Sen. Bernie Sanders (I-Vt.) is deploying organizers to mobilize opposition against the GOP's emerging reconciliation package, focusing on districts he has visited as part of his Fighting Oligarchy Tour.
Materials that organizers plan to distribute encourage constituents to call their representatives and request they vote no "on a bill to cut Medicaid, nutrition assistance, and education to pay for hundreds of billions of dollars in more tax breaks for billionaires."
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