Mutualism and New Banking Systems

Jock Coats and I, judging by websites and comments on various blogs, probably disagree on a million things. However, I was intrigued by his posting on mutual credit societies. Jock and some associates of his seem to have identified a way in which the idea of micro-credit (seen in somewhat compromised form in places like Bangladesh) could be applied to the United Kingdom.

Micro-credit will be familiar to English-speaking readers in the form of credit unions. These have traditionally (more in Ireland and the United States than Britain) been local, small-lending corporations which are legally and practically limited from running up huge accounts.

However, in Britain, a new form of business organisation has been introduced; the limited liability partnership. Jock and his group seem to have identified this as a vehicle for loans to local business, and individuals. They present it as a sort of building society with a wider remit, which will not be based on shares but on social partnership.

The banks, currently stuffing the mouths of their executives with as much gold as the cocaine in their nostrils will allow, would ordinarily have every reason to destroy such projects. However, we the taxpayers now own a large part of the banks. If we had a government which was representative and not owned by the rich--and not elected by two out of ten of the voters--we could get the banks to liquidate or control private finance companies, which the banks own, cream off the profits, and allow the new mutual societies to go about their great experiment. They could take their place in the context of locally controlled or owned utilities and services.

That would be a neat idea, wouldn't it? I feel as though I am paraphrasing Oliver North; use the bank's money, or that of private finance companies, to funnel cash or rebates to mutual societies and then back to local communities and honest businesses.

So, good luck to Jock Coats, however much we might disagree about things we can't do anything at all about.


Jock Coats said…
Thanks for the plug. In my view this is what Mutualism is about. And so I doubt if we'd actually disagree on as much as you think!

But it's a hard slog - the problem is not so much appetite for something different, and much moreso about regulatory blockages!
Martin Meenagh said…
Always glad to praise a really good idea, Jock. I'm a big fan of democratic public ownership on a local and national level, and your ideas fit right into that. Keep going!

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