So my proposal for this is that an international agency issues the EBCU. And on what basis should it issue it? Well again, why not on the basis of a country’s population? That every country should get an allowance for every citizen that it has, just as in a game of monopoly all the players start with an equal allocation of money there at the beginning. So this new money would be given to the countries of the world for them to start trading, and of course, the poor countries would be able to use their allocation to get out of the debt crisis that many of them are in, in fact if you’re creating money on the basis of debt then you’ve got to expect some of that debt to end up in the weaker parts of the world. It’s the weak who usually end up in debt, and so there will be less debt in the new system anyway, because first of all we’re giving people essentially a 'get out of debt free' card, by issuing the new money, and then of course these poor countries are going to get an annual allocation of emission rights, and they’re going to be able to sell a proportion of these. It's almost as if they’re starting growing a new crop, which they’re going to be able to sell every year. So we get a better balance between rich and poor in the world anyway.
Now the value of the new currency would be fixed in terms of the emissions rights, so the international agency that would issue the currency would also issue the emission rights on a declining basis each year. Each year there would be 5% fewer emission rights allocated than the year, before so that you can be sure you’re going to hit the target, and the issuing agency would say ‘well if ever the price of the emission rights rises above a certain level we will supply supply more of them, but we’ll take the EBCU you’ve used to pay for them, and we will destroy those EBCU, in other words we’re going to reduce the amount of global money in circulation.’
Now this means that less trading is going to be possible at a world level, so that’s immediately going to cut back energy demand. It doesn’t mean that any particular country suffers because of this, [becasue] if any country can in fact cut their energy consumption, then they can build their economy, they can get a higher level of income. So the onus is on individual countries and individual regions to move as rapidly as possible away from fossil fuels, because that either means they’re going to have more permits to sell or emission rights to sell, or less emission right to buy, so by doing this the whole direction of the world economy begins to change. Instead of always putting pressure on the environment, because of the need to expand, now the pressure is, well to take pressure off the environment, to cut back fossil fuel consumption, because the faster you do that the better living standards you can achieve.
So that is the proposal. It is being researched at the moment. We’re building an economic model to show how it would work. We don’t expect the United States (or indeed Canada, because of the long border) would ever wish to join such a system, and certainly the United States would never come in, because it would mean that it had to make very rapid reductions in its use of fossil fuels, and it would lose the power of the dollar. So we’re assuming in our model that all the EU countries including the ten that are about to join would participate in this system, along with their former colonial territories. So you’ve got some over consumers of fossil energy and you’ve got a lot of 'under-consumers', places like Indonesia, India, Africa and these countries generally have strong links of friendship still, and so the fact that real resources were going from say Britain to India, because the British were having to buy emission rights to continue to use as much energy rights as they do, this would in fact be good, because the EBCUs that go to India would in fact come back to Europe as demand for European goods, and of course it would be good for the Indians, because they would be able to lift their people out of poverty.
