August Review.com

By Patrick Wood, Editor
January 26, 2010

Introduction

Critics who think that the U.S. dollar will be replaced by some new global currency are perhaps thinking too small.

On the world horizon looms a new global currency that could replace all paper currencies and the economic system upon which they are based.

The new currency, simply called Carbon Currency, is designed to support a revolutionary new economic system based on energy (production, and consumption),
instead of
price. Our current price-based economic system and its related
currencies that
have supported capitalism, socialism, fascism and communism, is being
herded to
the slaughterhouse in order to make way for a new carbon-based world.

It is plainly evident that the world is laboring under a dying system of price-based economics as evidenced by the rapid decline of paper currencies. The era
of
fiat (irredeemable paper currency) was introduced in 1971 when President
Richard
Nixon decoupled the U.S. dollar from gold. Because the
dollar-turned-fiat was
the world’s primary reserve asset, all other currencies eventually
followed
suit, leaving us today with a global sea of paper that is increasingly
undesired, unstable, unusable.

The deathly economic state of today’s world is a direct reflection of the sum of its sick and dying currencies, but this could soon change.

Forces are already at work to position a new Carbon Currency as the ultimate solution to global calls for poverty reduction,
population control, environmental control, global warming, energy
allocation
and blanket distribution of economic wealth.

Unfortunately for individual people living in this new system, it will also require authoritarian and centralized control over all aspects of life, from
cradle to
grave.

What is Carbon Currency and how does it work? In a nutshell, Carbon Currency will be based on the regular allocation of available energy to the people of the
world.
If not used within a period of time, the Currency will expire (like
monthly
minutes on your cell phone plan) so that the same people can receive a
new
allocation based on new energy production quotas for the next period.

Because the energy supply chain is already dominated by the global elite, setting energy production quotas will limit the amount of Carbon Currency in
circulation at any one time. It will also naturally limit manufacturing,
food
production and people movement.

Local currencies could remain in play for a time, but they would eventually wither and be fully replaced by the Carbon Currency, much the same way that the
Euro
displaced individual European currencies over a period of time.

Sounds very modern in concept, doesn’t it? In fact, these ideas date back to the 1930’s when hundreds of thousands of U.S. citizens were embracing a new
political ideology called Technocracy and the promise it held for a
better
life. Even now-classic literature was heavily influenced by Technocracy:
George
Orwell’s 1984, H.G. Well’s The Shape of Things to Come
and Huxley’s
“scientific dictatorship” in Brave New
World.

This paper investigates the rebirth of Technocracy and its potential to recast the New World Order into something truly “new” and also totally unexpected by
the vast
majority of modern critics.

Background

Philosophically, Technocracy found it roots in the scientific autocracy of Henri de Saint-Simon (1760-1825) and in the positivism of Auguste Comte (1798- 1857), the
father of
the social sciences. Positivism elevated science and the scientific
method
above metaphysical revelation. Technocrats embraced positivism because
they
believed that social progress was possible only through science and
technology.
[Schunk, Learning Theories: An Educational Perspective, 5th,
315]

The social movement of Technocracy, with its energy-based accounting system, can be traced back to the 1930’s when an obscure group of engineers and scientists
offered it
as a solution to the Great Depression.

The principal scientist behind Technocracy was M. King Hubbert, a young geoscientist who would later (in 1948-1956) invent the now-famous Peak
Oil Theory, also known as the
Hubbert Peak Theory. Hubbert stated that the discovery of new energy
reserves
and their production would be outstripped by usage, thereby eventually
causing
economic and social havoc. Many modern followers of Peak Oil Theory
believe
that the 2007-2009 global recession was exacerbated in part by record
oil
prices that reflected validity of the theory.

Hubbert received all of his higher education at the University of Chicago, graduating with a PhD in 1937, and later taught geophysics at Columbia University.
He was
highly acclaimed throughout his career, receiving many honors such as
the
Rockefeller Public Service Award in 1977.

In 1933, Hubbert and Howard Scott formed an organization called Technocracy, Inc. Technocracy is derived from the Greek words “techne” meaning skill and
“kratos”, meaning rule. Thus, it is government by skilled engineers,
scientists
and technicians as opposed to elected officials. It was opposed to all
other
forms of government, including communism, socialism and fascism, all of
which
function with a price-based economy.

As founders of the organization and political movement called Technocracy, Inc., Hubbert and Scott also co-authored Technocracy
Study Course in 1934. This book serves as the “bible” of
Technocracy and is
the root document to which most all modern technocratic thinking can be
traced.

Technocracy postulated that only scientists and engineers were capable of running a complex, technology-based society. Because technology, they reasoned,
changed
the social nature of societies, previous methods of government and
economy were
made obsolete. They disdained politicians and bureaucrats, who they
viewed as
incompetent. By utilizing the scientific method and scientific
management
techniques, Technocrats hoped to squeeze the massive inefficiencies out
of
running a society, thereby providing more benefits for all members of
society
while consuming less resources.

The other integral part of Technocracy was to implement an economic system based on energy allocation rather than price. They proposed to replace
traditional money
with Energy Credits.

Their keen focus on the efficient use of energy is likely the first hint of a sustained ecological/environmental movement in the United States. Technocracy
Study Course stated, for instance,

Although it (the earth) is not an isolated system the changes in the configuration of matter on the earth, such as the
erosion of soil, the making of mountains, the burning of coal and oil,
and the
mining of metals are all typical and characteristic examples of
irreversible
processes, involving in each case an increase of entropy. (Technocracy
Study
Course, Hubbert & Scott, p. 49)

Modern emphasis on curtailing carbon fuel consumption that causes global warming and CO2 emissions is essentially a product of early Technocratic thinking.

As scientists, Hubbert and Scott tried to explain (or justify) their arguments in terms of physics and the law of thermodynamics, which is the study of
energy
conversion between heat and mechanical work.

Entropy is a concept within thermodynamics that represents the amount of energy in a
system
that is no longer available for doing mechanical work. Entropy thus
increases
as matter and energy in the system degrade toward the ultimate state of
inert
uniformity.

In layman’s terms, entropy means once you use it, you lose it for good. Furthermore, the end state of entropy is “inert uniformity” where
nothing takes
place. Thus, if man uses up all the available energy and/or destroys the
ecology, it cannot be repeated or restored ever again.

The Technocrat’s avoidance of social entropy is to increase the efficiency of society by the careful allocation of available energy and measuring
subsequent
output in order to find a state of “equilibrium,” or balance. Hubbert’s
focus
on entropy is evidenced by Technocracy,
Inc.’s
logo, the well-known Yin Yang symbol that depicts balance.

To facilitate this equilibrium between man and nature, Technocracy proposed that citizens would receive Energy Certificates in order to operate the
economy:

“Energy Certificates are issued individually to every adult of the entire population… The record of one’s income and its rate
of expenditure is kept by the Distribution Sequence, so that it is a
simple
matter at any time for the Distribution Sequence to ascertain the state
of a
given customer’s balance... When making purchases of either goods or
services
an individual surrenders the Energy Certificates properly identified and
signed.

“The significance of this, from the point of view of knowledge of what is going on in the social system, and of social control, can best be appreciated when one surveys the whole system in
perspective. First, one single organization is manning and operating the
whole
social mechanism. The same organization not only produces but also
distributes
all goods and services.

“With this information clearing continuously to a central headquarters we have a case exactly analogous to the control panel of a power plant, or the bridge of an ocean liner…” [Technocracy
Study
Course, Hubbert & Scott,p. 238-239]

Two key differences between price-based money and Energy Certificates are that a) money is generic to the holder while Certificates are individually registered
to each
citizen and b) money persists while Certificates expire. The latter
facet would
greatly hinder, if not altogether prevent, the accumulation of wealth
and
property.

Transition

At the start of WWII, Technocracy’s popularity dwindled as economic prosperity returned, however both the organization and its philosophy survived.

Today, there are two principal websites representing Technocracy in North America: Technocracy, Inc., located in Ferndale, Washington, is represented at www.technocracy.org. A sister organization in
Vancouver, British Columbia is Technocracy
Vancouver, can be found at www.technocracyvan.ca.

While Technocracy’s original focus was exclusively on the North American continent, it is now growing rapidly in Europe and other industrialized nations.

For instance, the Network of European Technocrats was formed in 2005 as “an autonomous
research and social
movement that aims to explore and develop both the theory and design of
technocracy.” The NET website claims to have members around
the world.

Of course, a few minor league organizations and their websites cannot hope to create or implement a global energy policy, but it’s not because the ideas aren’t
still alive
and well.

A more likely influence on modern thinking is due to Hubbert’s Peak Oil Theory introduced in 1954. It has figured prominently in the
ecological/environmental
movement. In fact, the entire global warming movement indirectly sits on
top of
the Hubbert Peak Theory.

As the Canadian Association for the Club of Rome recently stated, “The issue of peak oil impinges directly on the climate change question.” (see John H. Walsh, “The
Impending
Twin Crisis – One Set of Solutions?, p.5.)

The Modern Proposal

Because of the connection between the environmental movement, global warming and the Technocratic concept of Energy Certificates, one would expect that a
Carbon
Currency would be suggested from that particular community, and in fact,
this
is the case.

In 1995, Judith Hanna wrote in New Scientist, “Toward a single carbon currency”, “My
proposal is to set a global quota for fossil fuel combustion every year,
and to
share it equally between all the adults in the world.”

In 2004, the prestigious Harvard International Review published “A New Currency” and stated,

“For those keen to slow global warming, the most effective actions are in the creation of strong national carbon currencies… For scholars and policymakers, the key task is to mine history for
guides that are more useful. Global warming is considered an
environmental
issue, but its best solutions are not to be found in the canon of
environmental
law. Carbon’s ubiquity in the world economy demands that cost be a
consideration in any regime to limit emissions. Indeed, emissions
trading has
been anointed king because it is the most responsive to cost. And since trading
emissions for carbon is more akin
to trading currency than eliminating a pollutant, policymakers
should be
looking at trade and finance with an eye to how carbon markets should be
governed. We must anticipate the policy challenges that will arise as
this bottom-up system emerges,
including the governance of seams between each of the nascent trading
systems,
liability rules for bogus permits, and judicial cooperation. [Emphasis
added]

HIR concludes that “after seven years of spinning wheels and wrong analogies, the international regime to control carbon is headed, albeit tentatively, down a productive
path.”

In 2006, UK Environment Secretary David Miliband spoke to the Audit Commission Annual Lecture and flatly stated,

"Imagine a country where carbon becomes a new currency. We carry bankcards that store both pounds
and carbon points. When we buy electricity, gas and fuel, we use our
carbon
points, as well as pounds. To help reduce carbon emissions, the
Government
would set limits on the amount of carbon that could be used." [Emphasis
added]

In 2007, New York Times published “When Carbon Is Currency” by Hannah Fairfield. She pointedly stated “To
build a carbon market, its originators
must create a currency of carbon credits
that participants can trade.”

PointCarbon, a leading global consultancy, is partnered with Bank of New York Mellon to assess rapidly growing carbon markets. In 2008 they published “Towards
a Common Carbon Currency: Exploring the prospects for inte...” This report discusses both environmental and economic
efficiency in a similar context as originally seen with Hubbert in 1933.

Finally, on November 9 2009, the Telegraph (UK) presented an article “Everyone in Britain could be given a personal ‘carbon allowance.’”

“… implementing individual carbon allowances for every person will be the most effective way of meeting the targets for cutting greenhouse gas emissions. It would
involve
people being issued with a unique number
which they would hand over when purchasing products that contribute to
their
carbon footprint, such as fuel, airline tickets and electricity. Like
with a bank account, a statement
would be sent out each month to help people keep track of what they are
using. If their "carbon account" hits zero, they would have to pay to
get more credits”. [Emphasis
added]

As you can see, these references are hardly minor league in terms of either authorship or content. The undercurrent of early Technocratic thought has finally reached the
shore
where the waves are lapping at the beach.

Technocracy’s Energy Card Prototype

In July 1937 an article by Howard Scott in Technocracy Magazine described an Energy
Distribution
Card in great detail. It declared that using such an instrument as a “means
of accounting is a part of Technocracy’s proposed
change in the course of how our socioeconomic system can be organized.”

Scott further wrote,

“The certificate will be issued directly to the individual. It is nontransferable and nonnegotiable; therefore, it cannot be stolen, lost,
loaned, borrowed, or given away. It is noncumulative; therefore, it
cannot be
saved, and it does not accrue or bear interest. It need not be spent but
loses
its validity after a designated time period.”

This may have seemed like science fiction in 1937, but today it is wholly achievable. In 2010 Technocracy, Inc. offers an updated idea of what such an Energy
Distribution
Card might look like. Their website states,

“It is now possible to use a plastic card similar to today’s credit card embedded with a microchip. This chip could contain all the information needed to create
an
energy distribution card as described in this booklet. Since the same
information would be provided in whatever forms best suits the latest
technology, however, the concept of an ‘Energy Distribution Card’ is
what is
explained here.”

If you study the card above, you will also note that is serves as a universal identity card and contains a microchip. This reflects Technocracy’s philosophy that each person in
society
must be meticulously monitored and accounted for in order to track what
they
consume in terms of energy, and also what they contribute to the
manufacturing
process.

Carbon Market Players

The modern system of carbon credits was an invention of the Kyoto Protocol and started to gain momentum in 2002 with the establishment of the first domestic
economy-wide
trading scheme in the U.K. After becoming international law in 2005, the
trading market is now predicted to reach $3 trillion by 2020 or earlier.

Graciela Chichilnisky, director of the Columbia Consortium for Risk Management and a designer of the carbon credit text of the Kyoto Protocol, states that
the
carbon market “is therefore all about cash and trading – but
it is also a way to a profitable and greener future.” (See Who
Needs
a Carbon Market?)

Who are the “traders” that provide the open door to all this profit? Currently leading the pack are JPMorgan Chase, Goldman Sachs and Morgan Stanley.

Bloomberg noted in Carbon Capitalists on December 4, 2009 that

“The banks are preparing to do with carbon what they’ve done before: design and market derivatives contracts that will help client companies
hedge their price risk over the long term. They’re also ready to sell
carbon-related financial products to outside investors.”

At JP Morgan, the woman who originally invented Credit Default Swaps, Blythe Masters, is now head of the department that will trade carbon credits for the
bank.

Considering the sheer force of global banking giants behind carbon trading, it’s no wonder analysts are already predicting that the carbon market will soon dwarf
all
other commodities trading.

Conclusion

Where there is smoke, there is fire. Where there is talk, there is action.

If M. King Hubbert and other early architects of Technocracy were alive today, they would be very pleased to see the seeds of their ideas on energy allocation
grow to
bear fruit on such a large scale. In 1933, the technology didn’t exist
to
implement a system of Energy Certificates. However, with today’s
ever-advancing
computer technology, the entire world could easily be managed on a
single
computer.

This article intended to show that

• Carbon Currency is not a new idea, but has deep roots in Technocracy
• Carbon Currency has grown from a continental proposal to a global proposal
• It has been consistently discussed over a long period of time
• The participants include many prominent global leaders, banks and think-tanks
• The context of these discussions have been very consistent
• Today’s goals for implementing Carbon Currency are virtually identical to Technocracy’s original Energy Certificates goals.

Of course, a currency is merely a means to an end. Whoever controls the currency also controls the economy and the political structure that goes with it.
Inquiry
into what such a system might look like will be a future topic.

Technocracy and energy-based accounting are not idle or theoretical issues. If the global elite intends for Carbon Currency to supplant national currencies, then
the
world economic and political systems will also be fundamentally changed
forever.

What Technocracy could not achieve during the Great Depression appears to have finally found traction in the Great Recession.

[Editor's note: Read an international review of this article on The Daily Bell of Appenzell, Switzerland.]

Bibliography & Resources

Scott & Hubbert, Technocracy Study Course, Technocracy, Inc., 1934

Hanna, Toward a single carbon currency, New Scientist, 1995

Victor & House, A New Currency, Harvard International Review, Summer 2004

Hannah Fairfield, When Carbon Is Currency, New York Times, May 6, 2007

M. King Hubbert & The Technocracy Technate Design – Historical blog

Everyone in Britain could be given a personal ‘carbon allowance’, Telegraph
(UK)

Network of European Technocrats – website
for Europe

Technocracy, Inc. – website for U.S.

Technocracy Vancouver – website for Canada

Association for the study of Peak Oil & Gas – website for Peak Oil