I'm not sure what is wishful thinking? That the banking system in fact creates the vast majority of money in circulation" (in reality just numbers in a book or computer)? That we pay more for creating it that way than we would if the "state" simply did exactly the same for free (or at least a vastly reduced and one off cost)? That what the banking system does, anyone else would be arrested for as a fraudster and counterfeiter?

Or that we can actually do anything about it?

Anyway - to your question, LETS. I'm not talking about LETS, but it is an example of a non-usurous currency. All currency is simply really a note of who owes whom how much. That we have banknotes at all is merely a function of the fact that that "debt" from one to another may be repaid to a different person at a different time.

I've never heard of a LETS system charging interest, which is the important factor in the banking system. It is an obligation noted down somewhere to pay later, and in that sense it is "credit". But "credit" really means trust. In what other circumstances, other than the banking system do we pay for "trust"?

Compare the banking system to teh credit union system. All banks should be credit unions with no right to create new money ideally. The "state" (and I put it in quotes simply because it should not be a government function but should be something done on behalf of us all to our credit) would then introduce new money as the economy needs it, usually by spending it into existence either as capital spend or even as a citizens' dividend and then if there's too much in the system tax it out - the only reason really why there needs to be tax in my opinion.

Far more accurate than trying to control money supply indirectly through interest rates. And far less inflationary than creating money as debt."