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Helmut Lasarcyk

"If we have an income we did not work for, someone else worked for us and did not get the fruit of his labor."
~ Jan Sobrius

Interest-free money

Money is very practical. Nobody doubts it. And the payment of interest is acceptable when someone lends money to others and must do without it for some time. But how does the steadily rising inequality of income result from this? It's very simple. There is a vicious cycle in the system:

The money that I carry to the bank is handed out as credit to other people. This way my surplus becomes somebody else's debt. When they pay it back they add interest and I have more surplus, which has to be reinvested, of course. This way more debts for other people result and more interest payments for my benefit. Like this:

   A's money => B's debt => interests for A
  => more money for A => more debt for B => more interests for A
  => still more money for A => more debt for B => more interests for A

It is a never-ending spiral. Such system always end up in disaster. Nothing can grow forever.

Growing national wealth automatically means an incredible level of debt. Only a few have great gains, but they have so much already that they do not know what to do with their money. Wealth increases exponentially and is found in the pockets of fewer and  fewer people. At the same time, most of the population sink into poverty and largely work to produce the increase in interest for the top few. Whatever we buy every day, the price always includes costs of interest (roughly 30-50 per cent). More than three months every year we work just for the interests that few people (less than 10 per cent of the population) get, all the others are net payers.

Money that is paid for interest cannot be used for other things. It is easy to see where all the tight budgets come from. And we see: This cannot go on forever.

There are possibilities to prevent the breakdown of the economic system. Interests do not have to be abolished but they must be lowered so that money is not stored any more. This increases the velocity of money and leads to income for more people. Inflation is eliminated, social equity is increased and we get economic stability. Money makes the world go round! In the 1930s this worked well in the small Austrian town of Wörgl.

This subject deserves your closer attention. 

The most thorough work is The Money Syndrome by Helmut Creutz.
The most basic work is by Silvio Gesell: The Natural Economic Order (online)
There are plenty of English references at the German website www.geldreform.de.
Also see Declan & Margrit Kennedy: Interest and Inflation-free Money (PDF) USA 1995
Bernard Lietaer:  The Future Of Money: Creating New Wealth, Work and a Wiser World