Robert Skidelsky joins the debate about the need for a neutral global trading currency, but this time in the Financial Times which is also available at his personal website. This is the Green Party's policy and was proposed by this blog for the last G20. Skidelsky, being an unreconstructed Keynsian, has not included the planetary limit in his thinking; the EBCU proposal would do this. China will be arguing for a neutral currency, issued by the World Bank, as it has been doing for some time. We should put our energies behind this call, but with the additional twist of a currency that keeps trade and production within environmental limits, as well as bringing balance and equity.
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Nice title, excellent post.
ReplyDeleteI couldn't see the Skidelsky article you linked to at the FT without signing up to them. But happily the article seems to be available at his website.
Not being econo-literate or a regular reader of your blog I also wasn't sure what EBCU means.
Luckily a kind lady has already put some information about the Environment Backed Currency Unit out on the web.
;-)
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ReplyDeleteCan somebody translate all this into English please?
ReplyDeleteWeggis, on reading the previous post it’s clear the last paragraph is on the ‘inaccessible’ side. I’m Dyslexic and should be careful not to post on blogs via my phone. However, I’m not sure if my over use of ‘political economy’ jargon is the source of your public complaint? Anyhow, I’ll try and translate the two points I was trying to make:
ReplyDelete(1) China’s promotion of an international trading currency is a very positive development. An International currency based on Keynes principles would prevent countries running persistent balance of trade surpluses and deficits (which in my opinion is more damaging then government debt). It would also prevent speculative trading in currencies and it’s upheaval.
(2) The second point referred to Neo Gramscian ‘international hegemony’. According to this theory, an ‘international hegemony’ is the dominant and influential nation at a certain time in history. They achieve the position by being economically dominant, but also by upholding an international system which other nations benefit from. As a result the other nations choose the follow the international hegemony. Great Britain supported the Gold Standard in the 1900’s and the US supported Bretton Woods post 1940s. Both these systems allowed greater security and international trade which benefited other nations. The international hegemony acted beyond their direct narrow interests to support these systems, but obtained greater influence by the doing so.
So my point was China’s support for an international currency is for me the first indication they want to support a system which promote security and international trade, beyond their own narrow interests of running persistent trade surpluses. In doing so they are showing potential to move into an international hegemony position.
My apologies, Matt.
ReplyDeleteMy comment was not directed at you specifically, but the whole damn subject.