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Sod the European Union and loss of sovereignty. News arrives this morning that two state owned investment funds - The China Development Bank and Temasek, the investment arm of the Singaporean government, have between them taken a 10% plus stake in Barclays Bank.

Now, there's nothing new, or inherently threatening, about overseas money investing in UK companies, but in this case there are two issues.

First, these funds (as with the Qatari bid for Sainsbury's last week) are themselves so wealthy because of state protectionism. China in particular is not operating on the same economic "rules" as most of the west, what with pegged exchange rates and state control of assets generating this cash.

Second, Barclays is a bank, and as such in an incredibly privileged position. It is part of a cartel of a few organisations that effectively have the ability to create our money. A few choice quotes should suffice to show how awkward this could be...

Reginald McKenna, Liberal Chancellor of the Exchequer in 1915 and later Chairman of the Midland Bank, at the time the world's largest bank:

"I am afraid that ordinary citizens will not like to be told that the banks can, and do, create and destroy money. And they who control the credit of the nation direct the policy of governments, and hold in the hollow of their hands the destiny of the people."

Meyer Amschel Rothschild:

"Give me control of a nation's money and I care not who makes the laws."

Robert Hemphill (a director of the Federal reserve Bank of Atlanta in the 1930s):

"This is a staggering thought. We are completely dependent on the commercial Banks. Someone has to borrow every dollar we have in circulation, cash or credit. If the Banks create ample synthetic money we are prosperous; if not, we starve. We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless position is almost incredible, but there it is. It is the most important subject intelligent persons can investigate and reflect upon. It is so important that our present civilization may collapse unless it becomes widely understood and the defects remedied very soon."

Franklin D Roosevelt:

"The real truth of the matter is, as you and I know, that a financial element in the large centers has owned the government of the U.S. since the days of Andrew Jackson."

It's not that there should not be overseas investors in our commercial banks and so on. But that our commercial banks should not have the ability to create fiat money on their own initiative but in our name. We must either privatize the money supply or nationalize it - but if we allow other governments to take over the function through acquisition we can forget worrying about losing sovereignty to the EU and other such arguments, we will have handed real sovereignty, through control of our money supply, to foreign governments.

Technorati Tags: fiat money, monetary reform

For some reason I have Oliver Kamm's blog in my daily reading list. I have no idea why - I don't like his style, his politics or his opinions most of the time, but today he has a go at Chris Huhne about that nuclear issue. He says, at the end, that he's "doubtful that the Lib Dem contenders have thought much about this issue beyond their internal party positioning, and I wouldn't trust them anywhere near this country's security policies."

I think that's just wrong. Kamm picks on one word in Huhne's article on Trident..."independent". He says that the Trident system is independent to us - that we bought it once and for all from the Yanks (and saved a whole load of money because we did buy existing technology from elsewhere) and could use it independently. I disagree - I think we are dependent on the Yanks for maintaining the missile system - only the launch platforms, our nuclear submarine fleet, are ours.

Now all of this is a slight side-show. At the moment I cannot conceive of a situation in which the UK might be tempted to initiate an independent, unilateral launch of ICBMs. But if we did, and it was over a cause the Yanks did not agree with us on, would we find that "our" missile system was truly independent? I don't know, but for me all this misses the basic point, and one that Kamm simply sweeps under the carpet. Chris wants, if we can't negotiate multilateral complete disarmament, a different system because the threats today are different. Kamm seems to suggest that buying a system for the next forty years makes such a question irrelevant - the old threats may have returned in that time so we'd be back to needing a system like Trident.

I assume here the question is whether we want submarine launched long-range Inter-Continental Ballistic Missile nukes. And this is where we diverge. The threat is different. We have the existing system for a particular type of threat - that of massed ranks of opposing missiles targeting our cities and mainland installations where it is a good thing that we have our missiles offshore and moving around, albeit slowly, so that in a Mutually Assured Destruction scenario we can still launch when all our land based facilities are reduced to radioactive rubble. The US can have land based Minuteman missiles because they're on the other side of the planet from what was the main threat - the Soviet Union - and can be sure to be able to fire a few off before the USSR's nukes reach them.

Neither are appropriate for the type of threats we now have. Far more useful to us would be the sort of thing the Greenham peace camp was meant to prevent - nuclear armed cruise type missiles that are far more flexible as to launch platform and scenario, so called tactical nukes. Personally I can't see again a reason why we would use such creatures either. Emerging nuclear states have to have two technological breakthroughs to produce weapons that might threaten us or ours - the nuclear warhead and the long range launch platform. We've seen how claims of Saddam's ability to reach Cyprus were found completely untrue, we know that even North Korea's missiles were far from stable. We're more likely to see terrorist launched nukes come in the shape of a suitcase - ground detonated by timer - which no nukes of our own are going to be able to counter.

I am a unilateralist - no doubt someone whom Mr Kamm thinks a lilly livered coward out of touch with the world and its threats. But even if we cannot persuade the rest of the world to get rid of nukes once and for all at the next round of talks, I think the better deterrence nowadays would be a truly independent, multi-platform, tactical device rather than ICBMs designed for a particular cold war scenario of roughly matched opponents and "push button warfare".

One of the most common points of disagreement between, let's call them "state-interventionists" and "non-interventionists", is the claim that "non-interventionism" would leave the poorest in society on the scrap heap with no welfare, no support. That the much vaunted idea of "non-interventionists" that "private charity" or "voluntary co-operation" would take the place of state welfare is just an impossible pipe dream. So determinedly do "state-interventionists" believe their own claims that they frequently castigate "non-interventionists" as heartless uncaring selfish individualists who would rather see others die than pay taxes. One quote from a Lib Dem Voice "discussion" just today will give you the general idea:

"Well none of them [Libertarians] are serious, because it an incoherent philosophy....send the kids back down the mines, it’s only a lifestyle choice."

And to an extent, I used to believe that propaganda. As a geo-libertarian of course I do have an answer of sorts - the basic income derived from land user fees (which would on their own create an almost unimaginably more equitable society in any case) would cover the basics of life for everyone, and give everyone an incentive to top it up with as much or as little work as they can manage.

But a recent discussion on a "non-interventionist" mailing list I've been frequenting recently has challenged the basic assumption of this debate for me. Would people really not contribute voluntarily to the upkeep of others if you don't have a government apparatus threatening them with the confiscation of their property and ultimately the loss of their freedom unless they pay their taxes?

It is a strange proposition. Governments for at least the last sixty years have been supporters at some level or another of some form of state welfare. They may argue about how much is appropriate but the fact is, people have overwhelmingly voted for a state that takes money from you in order to give some of what's yours to someone deemed "less fortunate". We even have a cliche about the inevitability of death, and taxes.

We have tens, maybe hundreds of thousands of people who do voluntarily give up their time to care for another. Most people are someone's relative, someone's friend, someone's colleague. And whilst I recognize that some do not have such support networks and would still require some form of collective support, most people do not want to see their friends and relatives on skid row or worse.

One has to wonder whether the interventionist route actually makes things worse. And in how many ways. When we look at our pay packets do we not think often that we've given quite enough for the support of others through our taxes thank you very much. National Insurance and Income Tax between them effectively make the worker near forty per cent worse off. I know what I would do with an extra forty per cent each month. It would pay the interest bill on the piece of land we have just acquired for our first Community Land Trust for a start.

Other taxes and protectionist policies keep the prices we pay for basics artificially high and create incentives for companies to produce cash cows rather than exciting developments. I'll bet if we didn't guarantee one pharmaceutical company a contract for however many millions of doses of Metformin diabetes pills every year a dozen others would have put the effort in to find a cure, not a chronic treatment regime.

The attempt to do welfare as a "universal" system, with the same rules for everyone, means a bloated bureaucracy enforcing inflexible regulations. If welfare were, say, to be dealt with at the parish level, and the barriers to job creation caused by taxes eradicated, I'll bet you more people would be found some work, appropriate to their abilities, even if it didn't give them everything they need and then people would feel much better about helping them out with the rest - because they were trying to help themselves as best they could. We have no way of measuring that at a national level really.

We have a Professor here at Brookes, a chap called Steven King. His area is the History of Welfare mostly in the 18th and 19th centuries - probably the period which received wisdom says was the harshest environment if you were poor or hapless. But I was fascinated by a lecture he gave a couple of years ago on being elevated to the professoriate (you are elevated to that aren't you?). Apparently when parishes were responsible for pensions, those who actually got a pension - those whom their own peers and neighbours if you like knew had simply tried and been unable to support themselves (in common parlance I guess the "deserving poor") would get on average 75% of the average working wage for their area. For others there were varying levels of support down to a pretty basic safety net that was intended to be subsistence rather than comfortable for those they felt were "swinging the lead".

And then there's the problem of administrative costs. If I had an extra 40% in my pay packet and was going to give it away, I'd know that the people or organizations I was giving it to would get all of my donation. I'll bet for the 40% the state apparatus take off me in taxes, probably half actually gets to someone who needs it, to direct service delivery, if that.

So, given all those disadvantages of, and the singular advantage that people actually vote for, this tax based welfare system at some level or another, is it not just possible that by doing away with all that coercion, all that centralization, all that unproductive bureaucracy, the people who get to keep what they earn would be quite proud to "do the right thing" by their neighbours and communities? If they vote at the ballot box to have money taken off them by the state for things they obviously believe are necessary, would they suddenly feel they were not necessary or that they should not contribute towards those same things without the threats of the state?  Isn't that a totally illogical position?  You'd vote for it but not do it if the people you vote for didn't force you to do it?

And so, at the very least, would it not be at least a courtesy to accept that Libertarianism is an optimistic creed; that it is positive about humanity's innate ability and even need to help each other. You may call that a naive optimism. But I'd rather be a glass half full freedom lover than the glass half empty authoritarian approach that says humanity will not help itself unless it is forced to do so by the agents of a state apparatus that may, just may, cause more problems than it actually solves. Libertarian is not a "devil may care/beggar thy neighbour" philosophy but one that places the utmost faith in people, as individuals, to know and do what is right.

And as to whether it is a "coherent philosophy" or not, I submit that "non-interventionism" is the only truly coherent philosophy in the game. For once you admit the state can do one thing better than we can through voluntary co-operation, you inevitably end up in endless arguments between factions about just how much the state can do better, and the ultimate end of that arms race is totalitarianism - that the state can do everything better than voluntary co-operation. Which is manifestly not true.

Just by way of another brief interlude in my self-imposed blog silence while I am upgrading software and design, I wanted to mention the wonderful speech I heard yesterday. One of the nice things about being one of the university's governors is that I can get to choose to go to pretty well any number of graduation ceremonies. I don't avail myself of the privilege terribly often, but I went yesterday evening to the graduation ceremony for most of our law students.

The honorary graduand was Clive Stafford Smith, the British born US based death-row lawyer and campaigner against the death penalty and torture and all things Guantanamo. As I understand it, he is, like many passionate campaigners, if not many lawyers, not terribly well remunerated, to put it mildly. His clients tend, almost by definition, to be amongst the poorest, often least educated in US society, and they have no legal right to representation once the sentence is handed down. There's not a lot of money in death penalty appeals or sticking up for the disappeared in America's network of secret GTMO-like prisons.

So he was appealing for these bright young starry eyed graduates to come and be exploited by his charity, Reprieve, for a few months, or more precisely, their parents to fund them while they are there. He promised an experience the like of which they are unlikely to find in a whole career at the Old Bailey or the corridors of corporate power. While they may dream of millionaire partnerships at Clifford Chance, he does it because it is fun! You cannot imagine the fantastic feeling you get, he says, when you "whip George Bush's ass in the Supreme Court" and defeat the world's only super-power in their own courts.

And when you think about it, how do we measure success? Is it the money? Or perhaps the satisfaction of a David victorious against Goliath.