Money and Society: Review

I really do recommend taking this free online course, MOOC Money and Society. It is well run and accessible whether or not anyone has previous experience in the areas covered, but for those who do, it is thorough and offers reliable information with a very interesting perspective. I wrote a review with my personal comments at the end, and I have added a reply from Jem Bendell.

Summary of Money and Society MOOC: Lessons 1-3, then Lesson 4.

[Bendell, J and M. Slater (2015) Money and Society, free course,]

An overview of Lessons 1- 3, then Lesson 4, Alternatives

These give a good view of the current Monetary System, analyzed from the perspectives of 1: Money Functions, Forms and Fallacies; 2: The History of Money; 3: Impacts and Problems with Money. gives Jem Bendell’s twelve minute recap, but without references and sources this feels too general, only convincing if one is already convinced. Many of the resources available through reading, online audio and video, etc. were provided, and excerpts well chosen. Documentaries, available on you tube are informative, especially the three hour tedious Money Masters [], from Bill Still and made in 1995 but not out of date, and all three of Paul Grignon’s Money as Debt. [The documentary “The Four Horsemen” was not mentioned by Bendell and Slater, but other participants besides myself did. It is also a convincing account of history, problems and impacts, referring to the way cultural hegemony builds, and the need for cognitive change in mind-sets, but unfortunately in the last ten minutes it opts for a return to the gold standard and classic capitalism as a solution. Maybe this is why the MOOC did not recommend it,]

In lesson 1, the functions of money, , are identified, and forms of issuance [fiat, sovereign, commodity, etc]. Eight “traits” that money has are stated, as these are necessary to make it acceptable to the people who use it, whether they understand its function and issuance or not. These are:

  • Backing / intrinsic value
  • Nominal / face value
  • Incentives – put in place by issuers to create greater circulation, is the way government creates demand for its currency, local currency convertible to national may create demand by offering a % discount on exchange. Incentives and local currency can be banned by legal tender laws.
  • Payment technology – how people experience “the money” coins, notes, cheques, now often digital, via card or a pattern on a smart-phone screen.
  • Trust in the issuer
  • Cultural prevalence
  • Unit of value
  • Value over time

Along with lessons two and three, history and problems, the Current Monetary System and can be understood, and the analysis separated necessary issues from obfuscating details. The flaws are shown, and also how this system came about, through human construction. The groundwork necessary for Lesson 4: Alternatives, is laid. This makes the view of money as a tool for human need much clearer, at a meta-level, and opens up thinking about how to answer those needs.

In brief, whatever the system/s, or type of currency, the summary of my understanding is:

a) Money (and use of a currency) is a social relationship: the promise to pay;

b) There has to be a third party that upholds the promise, enables trust;

c) Although the system relies on promise, it is a claim on real resources otherwise the supply is not valid.

d) Real resources (planetary and human capital) are both limited in the present and uncertain in the future. Monetary systems are not neutral regarding these resources. The false belief that it can be is one of the reasons why the current system is flawed.

The Money and Society MOOC aims to look at alternatives, and actions that can be taken, rather than claiming a solution.


Lesson 4 Alternatives.

The first distinction made is between alternatives that have been tried, known to history, or as workarounds when economic failures have occurred, and alternatives that have not yet been implemented, or have only very local application. In considering alternatives, the capacity for trust, risk and governance needs to be transparent, hence the following groups of ideas were analyzed illustrating possibilities and issues.

Banking Reform, and other re-makes within the present system

“…we have explored in this MOOC that the root of the problem lies far below the day to day practices of globalised banking institutions, psychopathic though those practices appear to be. Even if banks broke no laws they would still be stewards of a constant transfer of wealth and power from the poor to the rich, the commodification of everything, and the consumption of every resource.

Consequently banking reform could be seen as a distraction …”

There are however proposals worth considering such as that of Public Banking [Ellen Brown] and a similar proposal from the New Economics Foundation to turn state-owned RBS into a network of local banks, modeled on Germany’s Sparkassen. These have not received much media coverage, nor have attempts to create the legal framework that would enable them been made. On the contrary, some countries have tried to prove in court that national central banks are unconstitutional. The other alternative form of banking that already exists is Islamic Banking. Although lending and borrowing of money at interest is prohibited, the Islamic banking movement has copied the institutional framework and product range of the interest-based sector so that in practice fractional reserve banking and interest-like financial products dominate.

In recent times, some leading voices within the monetary reform movement have called for greater reliance on equity financing, the promotion of investment funds rather than banks as financing intermediaries, and the separation of financing activities from payment transmission services. There are proposals for regulation rather than reform, narrow banking, where the institution is not allowed to take risks by giving fresh loans to business. Instead, it would use the incremental funds to invest in zero risk government securities, a very restricted form of banking.

Following the discussion of banking, there are brief discussions of:

  • The Gold Standard – backing can be any tangible substance to prevent issuance abuse, but it is noted that what actually gets traded is the promise of gold, not the gold itself, and that the gold can be ‘cornered’ by the already powerful. The dichotomy of ‘gold’ vs ‘fiat’ is the first level of the monetary reform debate, and neither solves the problem of trust without proper government.
  • Free Market Money [Hayek] – suggests that currencies of any kind could be treated in the same way as other commodities, and traded similarly, without the legal tender laws that privilege those nationally defined. Those issuances of currency that inspired confidence and trust would survive.
  • Or, New World Currency has been proposed, and the IMF already has a facility called the Special Drawing Right, originally created in 1969 to replace gold and silver in international transactions. SDRs could be global, replacing national currencies, in the same way that the Euor become a European currency.

I agree with the authors of the MOOC, Bendell and Slater, “We, your authors of this lesson, are very cautious about ANY global currency. There is a problem if one currency becomes the dominant or only currency across a diversity of economies, as then, as we see in the Eurozone, it can prevent countries from setting their own policies. But the main problem with a global currency is governance. The IMF is not a democratically accountable body to all governments or citizens of the world. A global currency could centralise political power, more so if and when it became global legal tender.”

Reforms and Alternatives needing Government Action

Bendell and Slater call these “Neo-chartalist Solutions”. They include Positive Money, the American Monetary Institute and Modern Monetary Theory. [AMI even has a bill prepared for Congress to enact, but there is no uptake by congressional representatives.]

In all of these, government (or governments, one by one, internationally) have to be convinced and take the action necessary to bring monetary reform. The challenges are listed:

  • What kind of reforms would be needed to ensure the government could be trusted with monetary policy?
  • How would the banking industry respond to losing the income stream from creating credit?
  • Government issuance, banks at 100% reserve and onward lending guidance for money from government.

Bendell and Slater also address the idea of Universal Basic Income. [They do not refer to Social Credit as proposed nearly100 years ago by Douglas, although it seems similar, nor to modern proponents of UBI such as Standing: The Precariat, last chapters on basic income and recovering the commons, and the Basic Income Earth Network, BIEN].

Bendell and Slater finish this section saying:

“While engagement in public policy can and should continue, given the limited prospects for deep analysis and informed policy debate on monetary policy today, where else might reformers put their attention?”

Complementary Currencies and Local Actions

Local, complementary or community currencies are social processes agreed by a group, say by exchanging legal tender notes for locally issued notes in a way that traps value in the local economy, creating more circulation there (the multiplier effect). Various means are employed to enable the exchange with legal tender. See for example Bernard Lietaer. Bendell and Slater acknowledge that complementary currencies do nothing for monetary reform, but are nevertheless proposed as actions that informed people can and should take. Slater stresses a vital value recognition:

“If a community currency was simply a printed note or an accounting system, then you could make a 1 2 3 recipe for starting one in your community, like boiling an egg. However this approach is unlikely to succeed, because a currency is more than just tokens and symbols. Currency is a social construct made from trust relationships; creating a currency involves deep work in your community. Because the Necessary Transition [to environmental sustainability] cuts across all areas of life, and because money is a symbol of value and not value in itself, a currency project should be an integral part of a wider … agenda in your community.”

There are many examples of complementary currency projects existing, and ‘recipes’ for helping the start-up. All involve work and support, possibly but not all need initial financial support, from many others. Certainly time has to be volunteered. The Money and Society MOOC finished with many of these examples, of the following different types: localized legal tender, collaborative or mutual credit, self-issued currencies, and crypto-currencies. It is clear that Bendell and Slater believe these are worth doing, for the human value and local benefit in the present, but also, because should more global monetary reform happen, they would favour a system that included a plurality of currencies, interchanged collaboratively, rather than reproducing a dominant national or global currency.

It was not stressed, but is notable, that all forms of complementary currency have to grapple with the problem of governance: What kind of ‘third party’ upholds the social contract that validates the currency? Many attempt to form a de-centralised or non-heirarchical self-correcting process, in the ‘rules’ by which they are set up. Crypto-currencies like Bitcoin may claim that this is built in to the blockchain by which they operate, but Bendell and Slater say:

“We would like to clarify the meaning of decentralisation in blockchains because the concept is often seized upon by apologists. Decentralisation can apply to many different aspects of a thing. The blockchain is a technology for decentralised data storage, but everything else about Bitcoin, we would argue is centralised. There is ONE currency, with ONE ledger, running on ONE protocol. In addition, the issuance of bitcoin has been to early adopters or those with the most powerful computers, leading to a distribution that is not at all decentralized. We do not think that bitcoin should be called a decentralised currency or that the expression is helpful. Decentralised data storage though is very useful as it inspires trust in the one true blockchain.”

It also seems inevitable that some form of crypto-currency, a digital currency, is likely to arrive within global and national monetary systems, whether reformed or not, and whether complementary currencies of digital or other types exist or not. Other open source blockchain currencies that have been proposed were also brought to attention. Whatever the kind of complementary currency, Bendell and Slater show that they want to see a plurality of types, and also, that a Commons type of governance [Elinor Ostrom] is established, so that the currency serves local and human need.

Absolutely recommended:

Greco, Thomas, Reclaiming the Credit Commons: Towards a Butterfly Society, in

The Wealth of the Commons: a World Beyond Market and State (2012)

My personal response:

I was convinced that complementary currencies are worth beginning, but see that much time and energy is required. I also am pretty sure that crypto-currencies will be developed, and indeed advance with properties we have not yet thought about, just as ways of exchange are also advancing and changing. I have negatives:

I believe that to spend time on complementary currency development of any kind, although worth doing in ones own community, may be a distraction from the real need for global reform. We must continue to tackle the need for reform of the global monetary system via representatives, government educational processes and planned campaigning. We should join with and collaborate with groups whose aims are different but overlapping or affected by money matters. My most important reason for campaigning to educate representatives is that I do not believe that ‘most people’ are ignorant, or even if they are, that they need to become experts in money matters. I believe that most people function as best they can in the system they are in, that their wish, like fish in water, is to spend time swimming, not examining and changing the water quality. This is the job of elected representatives, and I want them to be brought to realise that this establishment of good governance is their responsibility. I know I will not become a crypto-currency developer, may never work out how to use my smart-phone, nor do I want to be an economist, even a better informed one. Similarly I understand that in varied and different ways, this is true of most others.

The underlying humanness is about ethics – the inner attitude to living collaboratively, that is easy to demand, hard to enact when it seems that ones own life has to be protected.

Many references, sorry they are unsorted.

Wray, L. R. (2013). Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary Systems. New York: Palgrave Macmillan.

Bank of England Quarterly Bulletin Q1 2014

Positive Money

NEF, A Green New Deal (2008)

UNEP Global Green New Deal (2009)

Dyson, B. (2014, pers com) Personal communication with Jem Bendell

Ryan-Collins, Josh and Tony Greenham, Richard Werner, Andrew Jackson (2012) Where does money come from? New Economics Foundation.

UNEP (2014) “Inquiry on the Design of a Sustainable Financial System.”




Brown, Ellen Hodgson. The Public Bank Solution: From Austerity to Prosperity, 2013.

Bendell and Greco (2013) Currencies of Transition, in The Necessary Transition, McIntosh ed (2013), Greenleaf Publishing.

Ryan-Collins, Josh; Werner, Richard; Jackson, Andrew (2012). Where Does Money Come From?: A Guide to the UK Monetary & Banking System (2nd ed.). London: New Economics Foundation. p. 178. ISBN 978-1908506238. OCLC 816167522.

Werner, R., Jackson, A., 2012, Where does money come from: a guide to the UK money and banking system, 2nd edition, nef (the new economics foundation): London

Simmel, Georg, The Philosophy of Money (1907)

Dodd, N, The Social Life of Money, (2014) Princeton University Press.

Riegel, E. C, The New Approach to Freedom (1976) or full PDF book:

Lietaer et al (2012) Money and Sustainability, The Club of Rome.

Adams, J (1787) Letter to Thomas Jefferson, August 25, 1787.

Standing, Guy. The Precariat: The New Dangerous Class. London, UK ; New York, NY: Bloomsbury, 2014.

BIEN, Basic Income Earth Network,,_The_First_5000_Years Or PDF of full book:

Some excellent explanations:

The Cobden Centre, a collection of writers giving a broadly Austrian perspective

Episode 1 of this podcast:

Grignon, Paul, Money as Debt III: Two kinds of money 6 min

Martenson, Chris, Crash Course:

-chapter 6 6 mins

-chapter 7 Fractional Reserve Banking 4 mins

-Chapter 8 Government money creation with treasury bonds 7m

More on Margrit Kennedy

BCCI bank of the CIA

Cobden centre, a blogging platform for Austrian Economists

First UK debate in 170 years in parliament

New Economics Foundation: Inequality and Financialisation,

Money as Debt shows all money is promises, even Gold money at the end of the day

Hudson, Michael, The Bubble and Beyond (Book)

Frederick Soddy, The Role of Money (PDF Book)

Rickards, James, Currency Wars (Book)

Money and Life

The Money Fix

Peter Joseph creator of ‘Zeitgeist’

“People Money” and free tools from

Wizards of Money Podcast 6 – Democratizing the money system.


Hearn, Mike, Turing Festival 2013: Future of Money (and everything else)

World Islamic Mint Study Centre


Davies, G (2002) The History of Money:

Ferguson, N (2008) The ascent of money , Penguin Books. Documentary:

Graeber, David, 5000 years of Debt (2011) Chapter 8. Audio is here:, The First 5000 Years/5000-debt-08-Credit-Versus-Bullion,-And-the-Cycles-of-History.mp3

Zarlenga, S (2002) The lost science of Money

Martin, F (2014) Money: The Unauthorized Biography.

Rickards, James

 Reply from Jem Bendell

Dear Elspeth

Thank you for taking the time to review the MOOC. Does your report feed into a consultation and any decision making within the Positive Money network?

Your report is timely as we will be making upgrades to the content in August. We will also tweak the system to allow every other MOOC to run over 2 months not one month. We will also make a decision in August about whether to create a bespoke version for a specific profession, eg. development professionals, and whether to seek funding to record the history lesson as a video and promote it as a stand alone that could be watched by anyone and generate interest in the topic and the MOOC.

Please, anyone who receives this email and has done the MOOC, consider coming to our summit on April 22nd in London. Its free. We will discuss various ideas.

My thoughts on your comments Elspeth:
– It is important to emphasise that the first 3 lessons provide the context whereby most people conclude to support fundamental monetary reform
– The MOOC is very critical of many currency innovations, for instance we prepare students to critique Ven in lesson 1 and we are critical of bitcoin in lesson 4
– A range of alternatives are discussed and these all imply different theories of change and some different emphases on principles. We spend a little bit more time on collaborative credit forms of complementary currencies in Lesson 4 as this is what we consider has less attention than crypto, local pounds or monetary reform and is what we know more about. However, we do not argue these are the things students should focus on, as it depends on what your opportunities and skills are

You wonder whether complementary currency work “may be a distraction from the real need for global reform.” My view is that it could be an aid for such global reform as well as comprising an element of that global reform. It “could”, because it depends on how it is done. In the first two Positive Money retreats, I gave a presentation on whether currency innovators and monetary reformers are “Foreigners, Friends or Foes,” where I made the case for having a strategy to engage for mutual benefit. Your review makes me think I should write that up for publication as a blog. The benefits are for giving Positive Money campaigners more ways to engage on a daily basis in building monetary consciousness, and enlisting currency innovators in monetary reform campaigns. You wont get bitcoin fanatics to go along with that, and that’s the point… there are good and bad currency innovations with people involved for a wide range of motives, and we need to differentiate and promote what is useful for the common good and aligned with democratic reform of national monies.

Once I write the blog Ill send to everyone here… but it will take some time. Better to discuss in person on April 22nd.

Here is a link to the certificate course that runs in April in London

Thanks, Jem

Dr Jem Bendell
Professor of Sustainability Leadership
Institute For Leadership And Sustainability (IFLAS)


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