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In the latest survey by Swiss television 59% of the citizens surveyed will vote yes to a reform of the money system in Switzerland. The Full Reserve Money referendum scheduled for Sunday June 10th 2018 will ask Swiss citizens to vote on a proposed change to the Swiss constitution to require the federal government to supply the national economy with currency.

The proposed constitutional amendment by insertion of a new article reads: “Art. 99 Money and Financial Market Regulations: The Confederation guarantees the supply of money and financial services to the economy. It may deviate from the principle of the free market.’ This provision will allow the federal government to issue not only all the notes and coins but also all the electronic Swiss Franks in the world. The Swiss Frank in all its forms will be underwritten by the trust that the Swiss citizens place in their own labour and in each other and the citizens would decide how many Swiss franks are needed in the national economy and for what. The accounting practices of the central bank would have to change to allow for these three forms of legal tender to be spent directly into the accounts of the cantons, the local governments and the citizens, as well as into the accounts of legal persons such as businesses and banks. The Swiss National Bank assets in the form of notes, coins and intangible liquid assets (Swiss Franks circulating in electronic form) will be created and spent as per the needs of the economy as determined by the citizens. Existing commercial banks will no longer have the right to create money by keystroke on the basis of their own assessment of the creditworthiness of global customers. Their lending would be restricted to lending of Swiss Franks given to them by the federal government, or of course deposited with them by citizens or legal persons.

Apart from controlling corruption and illegality in lending by commercial banks, the crucial change will be that the sovereign can control lending by banks to avoid boom and bust cycles. It is great pity that the Socialist Party of Switzerland joined the present CEO of the Swiss National Bank and the Federal Cabinet in recommending a No vote on Sunday. As it is democracy in all countries and the principles of equality, justice, liberty and fraternity in the international system are fatally compromised by capitalism. This plebiscite in Switzerland is an opportunity for 8 million people in a small country to take back the power over a national economy from banks and put it in their own hands as the sovereign. That the Socialist Party of Switzerland officially has not understood the value of such democratic control over money creation shows how far it has departed from its founding principles.

Anandi Sharan was born in Switzerland, lives in Bangalore and last year worked in Araria District Bihar, India. She works on trying to find the best money system to help people adapt to climate change especially in India.

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