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According to the World Federation of Exchanges1, at the end of 2007, the total value of all shares listed on all global stock exchanges was 64.47 Trillion US dollars. At the end of 2008, that same global share value had dropped to just 33.73 Trillion. In one year, 30.74 Trillion of paper wealth vanished into thin air. 30.7 Trillion is more than five times Canada's total net worth in 2008 (6.07 Trillion). In just one year, the value of 5 Canadas just disappeared.

We're in deep trouble here folks. Speculative financial gaming has created a worldwide bubble machine and, in 2008, about half of our retirement savings burst into nothing. The global financial system is out of control and governments around the world appear to be in cahoots with the crooks who scammed us.

So if all this paper wealth is just smoke and mirrors, what then is real wealth? If you look at Canada's National Balance Sheet Accounts, you will see that Canada's non-financial assets (non-paper wealth) amounted to 6.1 Trillion dollars in 2008. This figure includes all of our land, buildings, machinery & equipment, inventories and durable consumer goods (goods of significant value like cars, boats, major appliances, etc.). So if you were looking to sell our country to someone and wanted to establish a fair asking price, 6.1 Trillion is it. According to Statistics Canada2, after using our financial assets to pay off all of our financial liabilities, 6.1 Trillion dollars is all Canada is really worth.

But wait a minute, the two most valuable assets we have aren't even listed on our National Balance Sheet. Surely our human resources and natural resources are our greatest treasures. All of the assets that are listed are simply a byproduct of bringing human and natural resources together. So why aren't these resources included in our accounting system? Herein lies the solution to our problems of usury and debt.

Suppose we simply added another line item to our National Balance Sheet labeled human resources (leaving natural resources out, for now). How could we determine a reasonable value for this line item?

Let's try the minimum wage. For easy math, let's say the average worker works 40 hours per week, for 50 weeks of the year, or about 2,000 hours per year. If that worker earns a minimum wage of $10/hr and works from the age of 25 to the age of 65, in those 40 years he would gross (before taxes) only $800,000 for a lifetime of work. In this age of billionaires, $800,000 for a lifetime of work seems ridiculously low, but let's try using it anyway.

If each working age person is worth $800,000 and there are roughly 19 million Canadians between the ages of 25 and 65, if we set our line item for human resources to the lifetime value of 19 million earning the minimum wage, it would equal $15.2 Trillion dollars. Wow, that's a lot of money. So let's use only one-third of that amount. Surely $5 Trillion would be more than reasonable to use as an estimate of the value of our people.

Now if we add this value to the asset side of our National Balance Sheet, we also need a corresponding liability worth $5 Trillion to keep our double-entry accounting ledger balanced. So lets create a new line item on the liability side of our balance sheet and call it a National Endowment Fund. We could then use the fund to offer all Canadians an interest-free, tax-free, non-repayable, once-in-a-lifetime, line of credit to help them get started in life. The endowment fund would simply monetize the currently intangible value of every Canadian and would be a birthright of the people. The fund would recognize that all human beings have value and contribute to society in many ways other than just through paid employment (ie. parenting, volunteering, caring for the elderly, etc.). The fund would also recognize that the strength and value of a nation is inextricably tied to the value of its human resources.

This one-time only endowment would be created for every Canadian once they reach a qualifying age of majority (the age of 25, perhaps). To protect it from inflation, the amount of the credit would be indexed to the market price of a bundle of necessities needed to get started in life. It would be sufficient to purchase a home, a new car, an education, etc. The endowment fund would be a government-created, line of credit without interest charged or paid. It would not be an income fund, it would be a once-only endowment fund. It would not be enough to live on without working, but it would be enough to help people get started in life without being exploited by the usury of interest.

Paying back the line of credit would be optional, but once it was used up there wouldn't be any more. Paying it back would be a way to save money for emergencies, retirement, etc. When a person dies their corresponding line of credit would be extinguished. No one else's money or credit would be affected and there would be no third party losses whatsoever. The balance between assets (people) and liabilities (credit) would always be maintained on the National Balance Sheet.
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The table above gives an estimate of how much it would cost to launch a National Endowment Fund that offered a maximum line of credit of $250,000 per person ($500,000 per couple).

The credit amounts would be reduced, in age increments of 15 years, by $50,000 per increment. So if you were 25 to 39 years old, you would get the maximum line of credit of $250,000. If you were 40 to 54 years of age, your line of credit would be reduced by $50,000 to only $200,000. If you were 55 to 69 years of age, your line of credit would be reduced again by $50,000 to only $150,000 and so on.

The main reason for the reductions is to keep the total cost reasonable, but it can also be argued that, since older people have already acquired some assets on their own, they do not need as much credit as younger people who are just starting out.

In order to qualify to receive an endowment, however, you would need to be a Canadian citizen who has lived and worked in Canada for at least 15 years. The estimate includes a cost reduction of $518 Billion based on recent immigration statistics from Statistics Canada.

The total cost to launch the fund would be just under $4 Trillion, which is only about 26% of the lifetime value of 19 million workers earning the minimum wage. $4 Trillion would be a very reasonable estimate of the value of our human resources to use on our National Balance Sheet.

A line of credit of $250,000 would represent 31.25% of a minimum wage workers total lifetime earnings. 31.25% of an 8-hour day is just 2.5 hours to justify giving minimum wage workers a 31.25% premium over and above their paid labour, we could reasonably expect them to contribute 2.5 hours per day of additional unpaid work to Canadian society. Most parents and homemakers already spend at least 2.5 hours a day on unpaid chores alone. Caring for friends and relatives, and volunteering is done in addition to that. 31.25% of an 8-hour day is just 2.5 hours to justify giving minimum wage workers a 31.25% premium over and above their paid labour, we could reasonably expect them to contribute 2.5 hours per day of additional unpaid work to Canadian society. Most parents and homemakers already spend at least 2.5 hours a day on unpaid chores alone. Caring for friends and relatives, and volunteering is done in addition to that.

So at minimum wage, a $250,000 endowment would be equivalent to just 2.5 hours of pay per day over 40 years. For people earning $25 per hour, the endowment's value would be equivalent to only 1 hour of pay per day over 40 years. That's not really an excessive or unreasonable gift is it? And considering that it enables the population to break free from the shackles of finance and the misery of usury, isn't it a very small social cost indeed?

Where would all this new money come from?
From the same place the banks now get the money that they lend ...from thin air and a few keystrokes on a computer. The endowment fund, however, would be created by the government through its own bank the Bank of Canada. It would be public credit, not private credit. A similar way to supply an interest-free, commercial line of credit to producers is outlined in the Better Way section of this web site.

Won't all this new money cause inflation?
No, the endowments would not create much more credit than what the banks have already created, or would create in the future anyway for new mortgages, car loans, education loans, etc., so it would be no more inflationary than the system we already have. In fact, it would be less inflationary because interest costs would no longer be embedded in prices. The endowment fund would be designed to automatically pay off all existing mortgages and consumer debts first, so that only the remainder (if any) would be available for new purchases. Also to prevent inflation, the rights of all private lenders to create money & credit out of thin air would be abolished at the same time the endowment fund was set up. For the truth about inflation, see the Cause of Inflation article on this web site.

People will simply go on a spending spree and waste the money they are given.
There would, of course, be some who would squander the opportunity to lift themselves out of the financial wreckage of life. To reject the whole plan, however, because of its inability to be 100% effective, would be like ignoring a cure for cancer because it helped only 80% of the afflicted. Yes having a more equal opportunity in life will force us to confront the irrationalities of excessive consumption more quickly. But such a day of reckoning is long overdue for all of us. At least the exploitation of the productive by the unproductive will have stopped and many more will be available to contribute truly productive work towards the needed solutions. And much of the personal financial stress that is tearing us apart will have been alleviated.

The suggestions here are simply a positive, practical, first step forward towards relieving the suffering that usury is causing today. Nothing will change unless a majority of people can clearly and immediately see positive, personal benefits in the solutions offered. Most people will recognize instantly that the quality of their life would improve if they could access a $250,000 interest-free, non-repayable personal line of credit once in their lifetime. Whether they know anything about banking or money creation or not, they should still support the idea at the polls, if they believe that the political party that proposes such a reform will actually carry it out once they are elected. A solid majority government elected with this mandate could implement these changes immediately.

We need solutions that are realistic and achievable today, in the here and now. The beauty and strength of these suggestions lies in the fact that they don't change most of the mechanisms of the existing economy at all. The credit creation process itself remains intact, just the interest disappears. Credit becomes a public utility, not a private extortion racket.

If you like these ideas, don't you dare just click away and do nothing! Democracy demands more from you than that. E-mail me with your ideas and suggestions about how to make this work. Let the evolution begin!

The Financial Party of Canada has now emerged to carry these ideas forward. Please visit their web site and get involved in the solution. The alarm clock is ringing... it's time to wake up!

1 source: World Federation of Exchanges, Annual Statistics, 2010, Equity Markets, Domestic Market Capitalization,

2 source: Statistics Canada, Cat#13-022-X, National Balance Sheet Accounts, Data Tables, Table 1, Fourth Quarter 2010,