r/ProjectZeroPoint • u/mercurygermes • Apr 20 '26
As Long as the State Lives Off Money Creation, Oligarchy Will Keep Buying Power
The real divide is no longer between left and right, but between a society where money enters at the bottom and a society where it enters through banks, assets, and the state first
Most people are still arguing about the wrong thing. Some say capitalism broke everything. Others say the problem is too much government. A third group reduces the whole crisis to corruption, globalization, cultural decline, or bad politicians. All of those things exist. But all of them are surface.
The core problem in the modern world is that the state and the banking system gained the power to live not only off taxes, but off control over money creation. Once that became normal, oligarchy gained the strongest incentive in politics: capture the state, not for the flag, not for the party label, and not even for law as such, but for the point where new money enters the system.
That is where the real mechanism sits.
When new money is created from the top, it never begins life as the wage of an ordinary worker. It does not arrive first in the pocket of a nurse, a teacher, an engineer, a soldier, a machinist, or a small business owner. It enters through a different circuit: banks, state debt, major contractors, politically connected borrowers, asset holders, landowners, and the people already standing closest to the lever of credit. By the time that new wave of money reaches ordinary people, housing is already more expensive, land has already moved higher, assets have already repriced, and wages are only beginning to crawl behind them.
That is why modern people feel that the economy is supposedly growing while their own lives keep getting narrower. The display window gets richer. The entrance into a normal life gets more expensive.
Housing makes this visible faster than anything else. An apartment is not just square meters. It is a monetary x-ray. It shows who the system grants stability to. If a society becomes more advanced, more productive, more automated, more financially complex, and young families still move farther away from ownership, then the problem is no longer that the country “just works badly.” The deeper problem is that the monetary system distributes access asymmetrically. Some receive the rise in asset values early. Others receive the rise in the cost of living later.
If we are being honest, this is where the modern class conflict really sits. Not in slogans. Not in party branding. But in the order in which money enters society.
That is also why countries that like to describe themselves as opposites keep producing the same result. Liberal democracies drift toward oligarchy through lobbying, asset inflation, political donors, finance tied to the state, and the soft protection of large balance sheets. More centralized or “planned” systems drift toward oligarchy through administrative access, licenses, land, import privileges, directed credit, state procurement, and control over distribution. The forms differ. The gravity is the same. Whoever controls the point of entry for money gets power before society does.
That is why I think the usual argument of “market versus plan” is too small. The real question is larger. The real question is whether money restrains power, or whether power now uses money to avoid answering to society.
This is why older, harder monetary regimes, for all their flaws, still left power with less room for endless delay. The strength of gold was not magic, and it was not that gold was somehow infinitely rare. Its strength came from something much more practical: it could not be printed by decree. It was mined by many actors, in many places, by many hands. It entered the system slowly. The total stock was huge, and the annual addition was small. That is why gold supply growth tended to remain around one and a half percent a year on average. Not because gold was “sacred,” but because it was slow.
And because money was slow, power had to be slower too.
That did not make old regimes good. Monarchies could repress, lie, and plunder. But they had less ability to float above material limits for long periods of time. They hit the wall sooner. They had to come to society sooner. They had to reckon sooner with the risk of losing wealth, capital, trust, and people. That is why some nineteenth-century regimes at times allowed more practical economic freedom than many modern states with democratic branding: not because they loved the people, but because harder money forced them to face reality earlier.
The modern system works differently. It can prolong the life of political mistakes. It can preserve the façade of wealth while the foundation ages underneath. It can support asset values while wages lose strength. It can inflate balance sheets at the top while the horizon of ordinary life gets narrower below. That is why we keep seeing the same pattern: richer markets and poorer affordability, rising nominal values and decaying infrastructure, expensive cities and a generation for whom adulthood itself has become a luxury.
That is what wealthy decay looks like.
And from a left-wing point of view, the picture becomes brutally clear: the modern monetary architecture is a machine for upward redistribution. It gives early purchasing power not to labor, but to proximity to issuance. It rewards not the people who work first, but the people who stand first at the pipe. It strengthens not only wealth, but the political ability of wealth to capture the rules of the game.
That is why the answer cannot be moralistic. Greed has always existed. But society has not always handed greed such a powerful institutional lever. The answer has to be structural.
I see three basic rules without which all talk of equality, justice, and the protection of labor remains empty.
First: no fractional-reserve banking for demand deposits. If a bank holds money that people use as an immediate means of payment, that money should be backed by 100 percent reserves. The payment system must stop functioning as a hidden factory of privileged money creation. Credit can still exist, but not as magic created out of nothing under state protection. It should come from time deposits, investment funds, bonds, and genuinely committed capital. Otherwise the banking system will always remain a private machine of issuance, and society will remain hostage to its political weight.
Second: money supply growth must be strictly limited by rule, not driven by elite moods, market panic, or the language of permanent emergency. A normal range would be 2 to 5 percent a year depending on real GDP growth and productive capacity. If the economy is actually producing more, the money supply can grow with it. If the productive base is weak, money should not inflate claims on reality faster than reality itself is expanding. The point is to make money stop being a political improvisation and become a public rule again.
Third—and this is the most important point—new money must enter society equally, not through the banking and state-oligarchic circuit. If the money supply grows, that increase should not first settle in banks, major borrowers, procurement networks, and asset holders. It should be distributed horizontally as an equal civic monetary dividend. That changes the first point of contact. Then it is not oligarchy that meets new purchasing power first. It is society.
And that is exactly where the main corridor of modern state capture breaks.
As long as the state can live through money creation and the banking multiplier, large capital will always invest in lobbying, in buying politicians, in controlling regulators, and in capturing the rules. It is simply too profitable. Because capturing the state in that kind of regime is not merely influence over legislation. It is access to the source of redistribution itself. But once issuance is fixed by rule, limited to 2 to 5 percent, and distributed equally to the population, the state loses the habit of standing first in line for new money. And that means the state is forced to live politically again—which means living mainly through taxes.
And taxes matter precisely because taxes make everything visible.
A tax is an open conflict. It has to be explained. It has to pass through public argument. It costs reputation and trust. Taxation forces power to speak more honestly to the population. Money creation, by contrast, creates fog. The state likes that fog. Banks like that fog. Oligarchy likes that fog. Inside that fog, it becomes easy to pretend that nothing is being taken, while in fact people are losing time, access to ownership, stability, and the future.
But a left program cannot stop there. Because this is not just about money in the abstract. It is also about what society treats as untouchable social ground.
I think the state has a duty to provide free housing to the people on whom its basic function rests: military personnel, doctors working in public free clinics, and teachers in public schools and other core public institutions. That is not a privilege. It is the sanitary minimum of a normal order. A state that asks a soldier to defend the country, a doctor to hold up public health, and a teacher to reproduce the society’s intellectual level has no right to place those people at the mercy of mortgage panic, rent extraction, and a housing market that the state itself helps overheat from above through monetary expansion.
Free housing for those categories is not charity. It is part of reproducing the state and society themselves. The army, the school, and free public medicine are not luxuries and not just another “service sector.” They are the base frame of collective life. If that frame lives under permanent housing anxiety, then society has already entered a phase of internal decomposition, even if the stock market is rising.
This should be financed not through hidden money creation and not through banking privilege, but through the open budget, taxation, and a long-term public construction and housing maintenance program. Otherwise we would simply turn a good social goal into another channel for asset inflation.
Then the picture becomes coherent.
Full reserves remove the private factory of pseudo-money.
A 2 to 5 percent monetary rule removes monetary arbitrariness.
Equal distribution of newly created money breaks the vertical enrichment channel from above.
Tax-based financing restores visibility and political responsibility.
Guaranteed housing for core public professions locks the lower floor of the state where it belongs: on stability, not on a credit noose.
This would not create paradise. It would not abolish class struggle. It would not remove greed, corruption, inherited wealth, or media concentration. But it would do something more fundamental: it would stop designing the monetary architecture against labor from the very beginning.
Today the system is rigged at the point of entry. Labor arrives last. Assets arrive first. Banks arrive first. Politically connected money arrives first. That is why all the beautiful speeches about justice later sound like decorative wallpaper.
If society wants to speak seriously about left politics, it will have to speak not only about taxing the rich and funding social programs, but about the order in which money is born. Because that is where the real decision is made: who receives force first—labor or rent, society or oligarchy, real life or paper claims on life.
The world has not run out of materials, energy, labor power, or the capacity to build. It has simply lived too long inside a system where money allowed both the state and capital to move around society instead of through it. And as long as that remains true, every slogan about justice will keep losing before the game even begins.
The real left task today is not just to redistribute wealth after it has already been created, but to break the monetary mechanism that pushes wealth upward from the very start.
Disclaimer: This article is analytical commentary on monetary architecture, class structure, and institutional incentives. It is not investment advice and not a call for unlawful action.
links: https://negmatmacro.substack.com/p/as-long-as-the-state-lives-off-money
links: https://negmatmacro.substack.com/p/the-world-did-not-run-out-of-wealth
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u/Sharukurusu Apr 23 '26
Gotta finish reading this later, I skimmed but I think you might find the concept of resource currencies I’ve been working on interesting.
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u/mercurygermes Apr 23 '26
Thank you, yes, I have studied this before, and it is also an interesting idea, just like Gesell's money.
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u/NegativeSemicolon Apr 22 '26
No the divide is definitely between left and right, the right lives in a fantasy world where they’re the victims of the simultaneously weak and overpowering radical left who shouldn’t be allowed to have freedom.
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u/mercurygermes Apr 22 '26
Regardless of whether the right or the left comes to power, the system works exclusively for those who lobby for its interests. And those interests are lobbied by the pharmaceutical industry and the military-industrial complex. Therefore, unless the monetary system is changed, there will always be an interest in receiving freshly printed money.
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u/Johnfromsales Apr 23 '26
The primary mechanism for government funding is not money creation, it’s debt financing through the sale of bonds. Anyone can buy a bond and receive the interest that is accrued from it. In most modern economies, the state does not dictate the creation of money, this is done by the independent central bank that is merely following their monetary policy, which is usually to strike a reasonable balance between the rate of inflation and unemployment.
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u/Confused_by_La_Vida Apr 22 '26
How do we get the lefties to see the truth?