Douglas Carswell's Blog

A multi currency Britain?

What do you remember about the year 1989? 

Margaret Thatcher in Downing Street?   The Stone Roses and Nirvana in the charts?     

One thing you might not immediately recall about Britain 22 years ago is that £1 was worth approximate twice what it is today. 

The cumulative effect of inflation in the intervening years has eroded the currency – and by extension the value of both debts and savings.  This in turn has encouraged people to over borrow and under save. Small wonder that economic growth has been based on over consumption and too little production.  Persistent inflation has transferred enormous wealth from the private to the public sector.  It has been the ultimate stealth tax.

Tomorrow I introduce a Bill that aims to stop this.  My 10 minute rule Bill on currency competition seeks to amend the 1954 Banknote and Currency Act to make a basket of competing currencies legal tender in the UK.

Under my proposal, Pounds Sterling will still be our national currency, issued by the Bank of England.  If you want to, you can carry on as you do today. 

But if you are unhappy being forced to use as legal tender a currency that at current levels of inflation will halve in value over the next 14 years, my Bill will give you the chance to do something about it. 

Families wanting to plan their financial future can do so using currencies that aren't systematically shrunk in order to allow government to grow.  Businesses wanting to protect themselves against rising prices could use money that wasn't diminished so that reckless officialdom can try to magic away its debts. 

At the click of a mouse, we are all able to shop around for books, music and financial services.  The internet also allows us to shop around and use multiple currencies as easily and seamlessly as we switch TV channels.

The Bank of England might keep on mismanaging the money supply.  Indeed, there is more talk of yet further Quantitative Easing.  But if the Bank of England persists in devaluing their currency, under my proposal, they would no longer be eroding the value of ours (which, incidentally, might help impose on them the kind of monetary discipline they've never quite had).

"This is bonkers" a certain type of reader might reply.  "Completely off the wall".  Hardly.  It was the policy of the Conservative government in 1989. 

You remember that?  It had won elections with handsome majorities and was not afraid to be bold and radical as it set the market free and lifted us off our knees.

UPDATE:  Various readers have asked for more detail.  Can I point anyone with an interest in it to this excellent publication?

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