Quote:
Originally Posted by Bownesian
That quote helped Mackenzie King win the 1935 election. He then formally nationalized the Bank of Canada (that had been created in the previous year), setting up our current economic system as a result. I'm not sure how that makes your point that our government isn't in control of its own currency and debt, just that our governments over the years have decided that private debt is a better option than what you propose.
If our government was to "lend itself money" (i.e. increase debt owed to the Bank of Canada to pay its bills) and either renounce our international debt or pay our debt off with Bank of Canada printed dollars, the result would be an immediate proportional devaluation of our currency on international markets, which would lead to inflation in the costs to purchase all those things that we do not produce ourselves and a cessation of international trade with Canada (in Canadian dollars at least).
This has been done before with results that I wouldn't consider to be positive. See:
http://en.wikipedia.org/wiki/Hyperinflation_in_Zimbabwe |
How our government officials came to the conclusion that it is better to privatize debt is beyond me.....maybe the right people were handing them some cash under the table to change legislation and turn a blind eye.
If our government lends itself money, interest payments would not be necessary.
Zimbabwe is a poor example imo. The same German company that prints their dollars prints ours by the way, and dont forget that Zimbabwe has very little oversight, as it is under the control of a dictator who is not accountable to anyone, so severe abuse of the system takes place.
Most founding political figures spoke heavily of the importance of the issuance of currency, including Lincoln, Washington, Franklin, Jackson and a host of others....and if you let it get into private hands things are bound to go bad...but those guys couldn't possibly more wise than our current leaders could they......
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