This submission has four parts. The first outlines how the financial system distorts wealth distribution in Australia and how there is no climate justice for any, including the wealthy, as all will suffer unless we all work together to address planetary limits. Without economic justice, humanity will have no future.
The submission outlines a method that dramatically improves the wealth of the bottom 90% of Australians by making the financial system more productive and evening out wealth increases without taking from the rich. It creates new capital to fund new technologies while using existing capital to transfer old wealth. In economic terms, it makes capital more productive by increasing the movement of capital.
The third section describes how refinancing housing to use existing capital makes it affordable and releases capital to allow Canberra to become energy self-sufficient.
The fourth section describes how the ACT government can fund greening Canberra without cost by investing new money towards greening and distributing the money via community organisations.
The proposal is based on reciprocal transactions where profits are shared between the parties who make it possible. It removes the need for and cost of money markets and redefines how the financial system operates so local communities work together to achieve common goals. In the new system, markets do not set prices. Communities set prices.
It reduces the power of large corporations and government treasuries and creates an economic democracy with predictable economic models.
1. The Distortion of Australian Wealth Increase
In April 2023, Richardson and Grudnoff published the following chart.
This startling finding corresponded with an increasing house price inflation. There can be no climate justice, while there is no economic justice. The article describes the cause and a solution.
2. Evolving the Economy with Affordable Housing
The distortion in wealth accumulation in Australia can be fixed by evolving the economy so that capital to purchase a house is available to all on equal terms.
The method uses existing money to purchase a house through Permanent Housing Markets.
An immediate start can occur with reduced Loan Repayments by banks.
3. Financing Housing with Permanent Housing Markets
When the cost of acquiring a home is halved, it releases existing capital for other purposes. Redirecting some of this capital to rewiring Australia with government assistance is possible. This happens by forming and encouraging Permanent Local Energy Markets.
4. Financing Local Energy Markets.
Permanent Local Energy Markets will halve the cost of electricity for the same reasons housing is twice as expensive as it needs to be. How this came about is described in the article Another Failed Economic Experiment.
Establishing Local Energy Markets is outlined in a Permanent Local Electricity Market.
Actions the ACT Government can take to Establish Climate Justice
For a net benefit to the ACT, the government can establish economic justice in the ACT and, in doing so, establish Climate Justice.
- Recognise that Economic Justice is needed before we can have Climate Justice. Recognise that the current economic modelling used within industry and government is flawed and does not model the real world. (Read local author Geoff Davies — A New Australia — Discarding Delusions and Organising for the Well-Being of All).
- Reform the Canberra Housing Market by encouraging the establishment of Permanent Local Housing Markets to release stationary Capital and halve the cost of purchasing a home.
- Work with Community Banks to provide the finance to transfer assets using existing rather than new capital.
- Work with Evoenergy to put Local Community Energy Assets into Local Permanent Energy Markets of solar panels, storage, and local electricity measurement systems.
- Establish an economic modelling unit within the government to use agent-based computational economic modelling.
