Chapter 16. Neither heaven nor hell.
The key issue in favour of the second hypothesis -modifying the
monetary system- is to see if its practical application is feasible, and
to value its dangers and possibilities.
We must not be so naive as to believe that the second option -modifying
the type of currency- shows no dangers or is not free of difficulties.
In the present complex societies we cannot go back to clay. But the different
possibilities offered by a personalized and informative type of currency
must not have, as a result, a simultaneous and overall single type of instrument
or of universal system. Every reality, every culture in which an anonymous
currency is more or less used, willingly or unwillingly, if the second
option is accepted, must find which features of the cheque-invoice, and
to which degree, are considered necessary to be introduced, with respect
the special problems and the profits which are expected from
the instrumental technical possibilities available, and the protecting
In the following chapters we shall study the technical possibilities and
the necessary judicial and political precautions. Now we shall shortly
describe and evaluate some models and posibilities of monetary change under
several specific realities.
To help visualize possible application models, we shall submit four
different ones, evaluating for each the degree of: economic information,
personalization and liability.
can call the first model Reagan-Gorbatchev. It was submitted by
Donald T. Regan, after having been Secretary of the Treasury in the USA
while Ronald Reagan was President. The plan was not applied in the USA,
but was partially applied, for different reasons, in the USSR by Gorbatchev
at the beginning of 1990. «In order to control the exchange of cash
by drugs wholesalers, retailers and hawkers [...], the Treasury should
unobtrusively mint new notes of 50 and 100 dollars, of different colour
and size than the present ones. With a warning of 10 days, all the existing
50 and 100 dollar notes should stop being legal tender, and everybody should
have to exchange his old notes for the new ones. Banks and other institutions
should keep a register of cash transactions above 1,000 dollars. Reports
would be sent to the tax inspectors with the name and tax identification
«This would cause a great panic among those holding great amounts
of cash. If the money were legitimate, nobody would have anything to fear.
This may create confusion during a couple of months, but which honest citizen
would not be ready to suffer a small inconvenience in order to get hold
of these lawbreakers? This would hit the criminals where it hurts most,
«Three things only could be done with money: to keep it in business,
to spend it, or to save it. If it were invested through a bank, this plan
could intercept the funds. If the benefits were kept in cash, the change
of currency would cause its seizure. If it were kept in the business in
50 or 100 dollar notes, they would loose their value1».
The model is shrewed, and is a good indicator of the impunity given
by the present, anonymous currency. But this model shows the changes which
have hardly any impact. After some months, the maffias would reorganizze
themselves and everything would be again as before. This model does not
offer an information of the whole market, it only wakens the area of hidden
and illegal economy. It personalizes and appoints liabilities, but only
The second model could be called the electronic purse. It has
been worked out by Jordi Domènech, engineer, and it suggests that
every person should have his savings recorded in an 'electronic purse',
designed to carry out operations directly with anybody else's 'purse' with
whom a trade operation is to be carried out: with this system rents could
be collected, and products and services could be sold and bought. The model
is amazing. Everybody becomes his own bank. There could be financial middlemen
who could collect transfers of currency for collective investment. An automatic
fiscal collection could be worked out when some very regular or security
operations were carried out (periodic copy of the purse information in
some given terminals).
Unless the purse had all the operations recorded, this model does not
give information on the overall economy. Even if all the operations were
personalized, it does not grant on its own any sort of liability, except
that, in the case of judicial research, the judge may have access to the
The third model, the companies' cheque-invoice, is today already
in practice. Most companies carry out their operations among them by means
of cheques and current accounts, with a data-processing basis. It would
only be necessary to put in one single document the invoice and the cheque
of all the operations. This model would avoid the feeling of excessive
control, as it would leave consumers to use the already limited, present
levels of notes and coins for their ordinary expenses, while they could
be compelled to make cheque-invoices for important operations (some luxury
items, real estate, investment bonds...). En important and trustworthy
economic information could be obtained. The liability-appointing personalization
would bear upon important operations and, in exchange, would not cause
offence to the sensitive 'freedom' of many citizens who wish to feel, even
if only in their imagination, little controlled.
The fourth model, the total cheque-invoice, would imply the exclusive
use for all operations of money recorded in current accounts, and the suppression
of all anonymous and uninformative currency. It would be a possibility
in those societies which had already found the advantages -economic and
anti-fraud- of the model companies' cheque-invoice and which decided
to invest in the diffusion of the data-processing equipment necessary to
extend to consumers the daily use of monetics. This greater economic information
and responsibilization of liabilities would call for greater changes in
the political and judicial structure ensuring the protection of privacy,
while attacking the impunity of crime. These conditions are carefully studied
in chapters 18 and 19.
After considering these four possible models, let us see now how their
combination, to a greater or lesser degree, may lead to a change of monetary
instrument under various present circumstances.
countries, but with a reduced domestic market.
In the case of a country with a simple domestic market, but with a major
export market (for example, certain African or Central America countries),
a combination may be made between 'notes with few monetary units' for lower
consumption operations and a 'nominal and informative cheque-invoice' for
really important operations such as: expensive or de luxe products; wholesalers;
all the investment or purchase operations among domestic companies; import-export
operations; public administration operations.
We must ensure that the most important, and the most strategic, volume
of money movement be under an independent judicial control and at the same
time supply information for a joint economic management. For small consumption
it will not be too serious that anonymous paper-money be used in small
units. It may also be established that this small units be valid only for
a certain period of time (one week or one month) and that, in this case,
it be supplied to every consumer according to the availability in his current
account, through the savings banks operating the public's current accounts.
A mixed introduction (small-change anonymous currency for current consumption,
and cheque-invoice for important operations) in a market with the above-mentioned
features could avoid the action of maffias and local bosses, hinder public
corruption, guard against multinational companies and control the army,
while respecting at the same time the customs and the level of education
of an important part of population, perhaps not prepared yet to use scriptural
or electronic cheque-invoices. These them could be used, however, by companies
and the public administration.
A very different case is that of industrialized countries which have
very complex and sophisticated markets. In these countries and in most
international commercial networks, electronic money is playing the lead.
We face here, therefore, an important decision to be taken.
In industrialized countries not only are companies and public administration
ready for a general introduction of a monetary cheque-invoice system, but
also small shops, services and the general public. In this setting, the
telematic cheque-invoice has an effective possibility of implantation,
and at the same time offers a consistent and democratic framework thanks
to the already widespread diffusion of the different sorts of electronic
money which are invading these countries.
The ECU (European Currency Unit) is a completely abstract currency
which, at present, has not physical support of metal or paper. Europeans
have, with the ecu, a historic opportunity to carry out the economic and
political integration of the continent with one single currency, for recording
purposes and personalized, thanks to the fact that, at the same time, all
the monetic networks are already practically connected. (See annex:
A plan against corruption).
In the field of international trade the introduction of a cheque-invoice
would not show any technical problem for its use, neither scriptural nor
telematic, because in practice at present it already uses these supports.
It is because of the joint inconsistency of the application of the electronic
and scriptural money that the greatest and most serious imbalances take
place in international trade and financial transactions and operations.
The flows of long and short term capital not always correspond to actual
purchases or investments. The massive movements of hot money and
many of the purchases and mergers of companies produce a divorce between
the monetary market and the market of actual goods and serivces. The capital
market becomes largely autochtonous and follows its own rules of the game
(creation of capital on capital) which endanger and put off balance the
A new international monetary system could be based on the cheque-invoice.
In the same manner as the ecu, an ICU (International Currency Unit)
could be introduced which would supply international trade with a monetary
unit for the exchanges of real goods and services, without having to accept
the dangerous, unstable and speculative hegemony of the US dollar. It appears
evident that the creation and circulation of huge amounts of monetary units
all over the world -through electronic transfers- with the only objective
of speculating, taking advantage of the time differences or of the momentary
imbalances of this or that stock exchange, is no good basis for any international
economic order. And on the contrary, a cheque-invoice system which only
allows to move money if it corresponds to some sort of real operation (goods,
services and investments) may be a good basis.
We must study more in depth to which extent it is possible to introduce
the hypothetic cheque-invoice monetary system in one or more States or
at an international level, and viceversa: if it could be so at an international
level without thereby implying any actual State. These questions are important
not only to find out the consistency of the proposal but also to orientate
and make possible the political decision in one sense or the other. (The
international subject will be studied more in depth in a coming essay).
in transition to real capitalism.
The growing acceptance of market mechanisms in the Eastern European
countries offers a historic opportunity to avoid bringing into the trading
system some of the main malfunctions of the 'capitalistic market economies'.
In this respect, taking into account some of the positive contributions
of the socialist countries is concerned, we must ask ourselves:
how can we avoid the denationalization and the introduction
into the trading system of the land, with the resulting speculation and
the burying of investment resources?
how can we promote a longed-for and necessary increase of incomes, not
to be used exclusively to purchase consumers' goods -mainly imported- thereby
dooming necessary domestic investments to dependence from external debt?
how can we create investment and capitalization instruments to avoid
the speculation of stocks and the subtle and dangerous financiering of
real economy, which promotes the accumulation of money in a few hands,
outside the circuit of real production?
how can we avoid, without further increasing bureaucracy, that the corruption
of the old regime be perpetuated under new ways thereby hindering the strengthening
of the lawful State?
These questions have a difficult practical reply within the present financial
and monetary system. Taking inspiration from Joan Casals (19872),
who suggests the introduction of one single title -quasi-money- for the
savings assigned exclusively to investment, side by side with normal money.
The possibilities of the cheque-invoice would allow to be applied to this
'money' which strives to protect the investment cycle. One part of the
incomes (of salaries, profits and dividends) might be set apart exclusively
for investment, in this way the workers and employers would become joint
owners of the companies. The much discussed return to the private ownership
of the land might find an agreed solution. The state property of the land
would change to communal property and, when necessary, the old private
owners would be compensated, exclusively with 'money' assigned to domestic
With this system total incomes of the population would increase but
it would be avoided that this were used only to increase the consumption
as they could only be used for investment. The market would have the actual
use of each of the income parts (such consumption item or such investment
in a given company). In exchange for this, the macroeconomic values could
be indirectly controlled, by modifying the percentage ratio between consumption
money and investment money in salaries. Insofar as the personalization
of monetary instruments became general, hidden, unlawful or the remaining
speculative economy would be curbed.
With the introduction of this monetary instrument reserved for investment
it would be easier to separate flows and stocks, and therefore natural
resources would be more easily included in the economic system, in order
to avoid their present, antiecological, externalization.
In this chapter we have only tried to prove that in the
subject under consideration there is a wide number of solutions, and that
to apply more or less of them depends on the problems which we want to
be face, on the possibilities offered by every reality for its transformation,
and also on the risks we may be ready to take and on the ability to introduce
political mechanisms to ensure the right performance.
dar buen uso al dinero de la droga», El País, 21.9.1989.
Casals, «El socialisme sòlid», La Llar del llibre, Barcelona,