A fascinating appraisal of why governments don't use their currency-issuing capacity more effectively:
https://billmitchell.org/blog/?p=61760The author asks the question: “Who indeed does administer the global finance system and where is this administration located?”
He focuses on the ‘City of London’ as the “greatest of all” and notes that it embedded in a “structured organisation” in the form of the “City of London Corporation (CLC)”, which:
At a national level, the CLC intervenes directly in the economic policy of the British government, while at the level of British overseas territories and crown dependencies, it makes use of a network of tax shelters.
The ‘City of London’ is “nicknamed the ‘Square Mile’ … and does not actually refer to a territory, but to all the financial service activities associated with Greater London.”
The mission of the CLC is “to promote the City’s financial services throughout the world … In short, it has to run the world’s leading financial center and do so in a way that ensures it remains at the top.”
We read that “The CLC is ugiven that the final fiscal balance each period is not able to be controlled by the government anyway,nique to the City of London and its independence is marked by exceptional privilege” that goes back before William the Conqueror became the King.
Further:
Another distinctive feature of the CLC is that its administration has significant funds at its disposal, which it invests in line with the policy chosen by the Common Councilmen and Aldermen. This gives it a lobbying power that is beyond that of any other administration. Its financial power comes from three funds (City Bridge Trust, City Fund, and City’s Cash … whose assets are unknown, but estimated to be three billion euros (Shaxson 2012) and most certainly include real estate assets throughout the entire world.
So a big bully with cash.
But even then the CLC lost a major court case in 2002 when activists successfully delayed a property development that the City was pushing which would destroy a local working-class neighbourhoods.
Here is some background to that fight:
1. Save Spitalfields from market forces (July 15, 2001).
2. Tales of the City: Spitalfields under threat (October 9, 2002).
We also know that ‘The City’ has:
… branches that feed it are mainly to be found in the British overseas territories and Crown dependencies, which regularly vaunt their financial opacity and concealment like an advertising campaign … These nine territories represent 2,800 billion dollars in deposits. In comparison, Switzerland has 1,200 billion dollars and Luxemburg, 900 billion.
And guess what?
The United Kingdom provides them with defense and security, and manages their foreign affairs in concert with their local governments. It is generally agreed that these are the black holes of world finance. In the second quarter of 2009, for example, City banks received 332.5 billion dollars from its three dependencies … these territories are the port of entry for significant capital flows into the London financial center, which is therefore being fed capital lacking in transparency.
Which means:
The British authorities and, to an even greater extent, the CLC hide behind the ceremonial sovereignty of these nine territories to absolve themselves from having any control over these funds and from any responsibility as to their origins. The City banks use them like capital pumps feeding its markets. However, these territories are very politically and economically dependent upon the United Kingdom. It is difficult to believe that the British Chancellor of the Exchequer is incapable of persuading or pressuring these territories to clean up their financial markets and institute stricter controls and regulations. Once again, the role of the CLC is of prime importance. It certainly has no interest in such measures and is quick to remind the British government of the fact.
So, when one is confronted with the claims that British Labour must appease ‘The City’ or face currency destruction, the real question is why doesn’t the British government exercise its legislative capacity to control the sources of any capital flows that might cause currency disruption?
That is the nub.
While ‘The City’ masquerades as all powerful, it could be brought to heel relatively easily through appropriate legislative interventions.
Of course, ‘The City’ lobbies relentlessly.
We learn that:
In order to monitor the work of Parliament so that it would never interfere with the power of the CLC, a chair was installed in 1571 beside the Speaker’s chair in the House of Commons, where an officer of the CLC, called the Remembrancer, still sits today. The City of London is thus the only British territory to have installed an official lobbyist within the House of Commons itself, who makes sure that the rights and privileges of the Square Mile are preserved.
So there is a “non-democratically elected officer who participates in the sessions of the British Parliament” and is there on privilege which would be revoked.
I have been tracking down discussions about this seemingly ridiculous medieval practice and came across the 1937 book by the Leader of the Labour Party – Clement Attlee – who later became Prime Minister (in 1945).
In this book – The Labour Party in Perspective – Attlee provides an interesting account of the powers of government and how they can implement them.
He writes that (p.178-179):
cont.
Forum
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Modern Monetary Theory (MMT) (Read 96917 times)
