E-Money

From my science fiction novel Half Square:

Dr. Delta: The E-money meme is highly infectious but not virulent.

FS: The Asian Union dumped their own currencies and adopted e-money as their official currency.  E-money was totally electronic within the AU.  There was simply no paper money used in the Asian Union.  All monetary transactions were done with an e-card, similar to a credit card. 

DG: Why this radical move? 

FS: This made street crime very difficult since the AU central authority could easily analyze any transaction done with an e-card.  Both dólares and euros backed e-money.  The euro and the dólar were contra cyclical.  If one currency went up then the other one went down.  E-money was the most stable currency on my world and this had special advantages. 

DG: Paperless money?  Sounds impossible.

FS: Money is the ultimate meme.  Money is ultimately an idea.  Backing the e-money with euro and dólar reserves was more for psychological purposes than stability.  Even my world wasn’t ready for true e- money and needed the crutch of paper moneys backing the e-money.

DG: So e-money was a giant memetic warfare strategy?

FS: One of many, the East Chinese government in Shanghai used their huge euro and dólar reserves to manipulate the world money supply and thereby control the world economy.  The AU government used the reserves to buy goods and services outside the Asian Union but could and did decide which currency to use for particular macroeconomic transactions such a big AU government contracts.  Deciding to use the euro or dólar for that transaction would dramatically increase the relative supply of euros or dólares.

DG: Why did the Asian Union do this?

FS: The maxim was “He who controls the money supply of the world, controls the economy of the world.” 

DG: So the AU was trying to control the money supply of the world?

FS: E-money didn’t give the Asian Union total control over the money supply of the world since the United Americas and European Union could still print more money but e-money did give the AU more economic control domestically and internationally than paper money would have.  Several books had been written about monetary warfare and East Chinese economists were seen as generals with a new weapon. 

DG: Why did the China in your Earth focus so much on economic means?

FS: Revisionist Chinese historians claimed that imperial China had controlled the middle kingdom primarily through economic rather than militar means and that the Chinese naturally excelled at such types of control.  Chinese had superior technology to their neighbors for hundreds of years and this had translated into superior products and services that allowed for Chinese dominance.  The decline of China had begun with a decline in relative technological progress compared to the West.

DG: Sounds like a reasonable view of Chinese history.

FS:  Japan had correctly focused on technological development first, then economic progress but had almost destroyed itself in World War II when it pursued a militaristic path.  China had been distracted by various social agendas but now was on the right path of economic superiority that would lead to political control of the world.  This view claimed that a study of Chinese history taught the Chinese that economic imperialism was more effective than militar imperialism. 

DG: So the goal is economic power?

FS: No, the goal is to control the means of memetic production through whatever means necessary including economic means.

DG: My area of expertise has always been micro-memetics i.e. psychology rather than macro-memetics i.e. social sciences.  What do you know about micro-memetics?

FS: Not much, actually I just know that my Square Earth focused on memetic war more than this Earth.

DG: What about good old fashioned none memetic war?

FS: Regardless, of arguments about the past, most agreed that every militar adventure since the 1970’s by a major power had ultimately failed and there was a pattern to this failure.  On my Earth, UA militar action had failed in the long run in Vietnam, Serbia, the Gulf War and the Colombian Droga War. 

DG: How so?

FS: The huge militar budgets incurred by the United Americas in these conflicts had ultimately contributed to the UA economy growing more slowly than the rest of the world and losing its dominant economic position. The cost of these militar actions escalated to the point that the major power injured the economic means that enabled militar action in the first place.  The United Americas economy had been so rich it took much, much longer for the cost of its militar adventures to ultimately hurt the economy but eventually the fall came and the Asian Union sped ahead.

DG: I thought the military power of the US had made it number one in the 20^th century.

FS: The US is of course different from the UA but I think the real lesson of the success of the US is the success of the US economy.  US militar actions by the US in Vietnam and the Middle East have hurt the US not helped the US.  In hindsight, the US had ultimately out spent the USSR and defeated the USSR via economic means rather than militar means. 

DG: And on your world? 

FS: In my world, the relative prosperity of the AU was due to its low militar spending.  The relative lack of prosperity of the United Americas was due to its high rate of militar spending.  Sun Tzu, the ancient Chinese militar strategist had written that,” One spy was worth a thousand soldiers.”  A new saying arose on my Earth; “One billionaire is worth a thousand spies since money controlled spies.”

DG: You mentioned Shanghai as being the capitol of East China.  Was East China a separate country?

Keep in mind I wrote the above several years before the following happened:

http://edition.cnn.com/2009/BUSINESS/03/25/china.currency/index.html

From the above article:

“On Monday the governor of the People’s Bank of China proposed expanded use of an alternative — the International Monetary Fund’s SDR, or Special Drawing Right, an accounting unit based on the euro, Japanese yen, pound sterling and U.S. dollar.”

The novel can be downloaded for a nominal fee at:

http://stores.lulu.com/foxhugh

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