Restarting after a trip to KCDC

Just been to Kapiti Coast District Council where I accompanied my husband Malcolm Murchie. He was giving a submission on behalf of the Democrats for Social Credit and it was quite good.

He spoke of the growing debt of KCDC, now at $99 million. It grows each year because they only pay off $5m a year though they pay $6.7 in interest to overseas owned banks. The request was that KCDC takes a remit to the Local Bodies conference asking for Reserve Bank credit at zero or very low interest rates. Total debt of all local bodies in NZ is $6.5 billion. A reasonable request and now he needs to find a councillor to champion this and at least have their discussion held in public. Otherwise they will discuss it and dismiss it quickly while in committee.

We had sat through very worthy submissions from small local groups like the Te Horo ratepayers asking for a few thousand dollars, and the Lions club and the Surf Club. The amounts are tiny in comparison with $6.7 million of potential savings, money wasted in interest.

I have been contemplating what is going to happen economically as things come to a head on the international financial scene. The European Union is in trouble with Greek, Portugal, Italy and Spain being in such severe debt and Strauss Kahn who would have rescued them is in jail. Last night the European sharemarket dropped. Collapse is bound to occur one day soon. The Irish originated book Fleeing Vesuvius is being published by Living Economies soon, explaining what could happen as demand for oil finally outstrips the supply and how an economy can no longer grow after peak oil. The economic system is set up to demand economic growth and with resources finally meeting geographical limits it is all going to stop. In fact Richard Heinberg says the global economy stopped growing around Sept 08 when there was a collapse in oil prices.

What with the price of food continuing to rise, and the price of house insurance about to rise by 50% because the reinsurance companies can't deal with two Christchurch earthquakes, a Queensland flood and a Japanese tsunami, we are all going to be in dire economic straits soon. If the TPP free trade agreement goes ahead then the price of medicines may also rise. Rob Hopkins, founder of the Transition Network, said on his blog the other day that we need to move now from peak oil and climate change to the strengthening the local economy.

Of course I am in favour of local currencies. In their economic crisis in 2002 Argentina didn't only have a plethora of local currencies, but their government legislated to allow regional governments to issue their own currency. Local currencies can never scale up to the needed $6.7 million required in the Kapiti District Council area. So it is either going to be a regional currency or we will have to get Reserve Bank money as US did in the big financial crisis, though it was called "quantitative easing" to give it an aura of mysticism and noone could understand what it was.

I guess as things get worse, we are going to stagger towards all these solutions, but all too late to prevent terrible suffering.