With Covid having destroyed our tourism and related sector industries, and pushed some communities to the brink, a fiat currency, directly targeted at supporting those enterprises primarily effected, should be considered.
Abraham Lincoln, faced with the crippling cost of otherwise funding the American civil war, instituted a fiat currency and the notes his government issued, which came to be known as “Greenbacks,” were vital to Lincoln’s winning of the war.
We are at war with Covid and to fight it, a government-backed fiat currency, issued not as notes but in the form of a card, like the Gold Card the oldies flourish, would have many political and social advantages over current crude lump-sum payments and loans.
Like the Gold Card, which works well and may only be tendered for goods and services provided by registered suppliers, similarly, a “Covid Card” could only be redeemed by enterprises registered to accept them – the self-same people to whom the lumps sum payments and loans are going now.
In essence then, a Covid Card system would be just a more socially responsible and transparent way of doing what the government is already doing.
But, unlike lump sum payments, a Covid Card, backed by the Government, would not only save money but, and most importantly, it would require registered recipient business enterprises to remain fully operational, to receive payment.
Critically, that would ensure that currently-at-risk communities survive this Covid war, with the added social advantage of directly involving “the team of Five million” in making it happen.
Backed by the government, a universal Covid Card would have Kiwis flocking to use the amenities, goods and services of endangered enterprises and those of dependent communities currently teetering on collapse.
Covid Card payments, once deposited into the registered enterprise’s bank account, would immediately convert to New Zealand dollars which would then be available for the normal payment of wages, and all things usual in running a business.
It would be business as usual.
Competition for customers in a Covid card bubble would still require good service standards be maintained, and the usual promotional activities; advertising, special deals etc, would still need to be deployed
While ensuring jobs and taxable incomes are maximised, a Covid Card would have the added bonus of allowing a much more diverse range of Kiwis to experience parts of the country they might otherwise be unable to even think of visiting.
While a Covid Card might not generate the same revenues normally generated by international tourism, current assistant plans were never going to achieve that anyway, but the revenues generated by a fiat currency would at least be fairly distributed.
Not only would a “Covid Card” save the government money, generate taxable incomes, be transparent, discourage feather-bedding and ensure whole communities benefitted, but also, and perhaps even more importantly, it would allow us to be “hands on” in helping each other through these troubled times.
Before the word FIAT came to be associated with an Italian motorcar, it was Latin’ for; “Let it be done,” which is a phrase a socially responsible government might consider.
We just have to come up with a better name for the damned thing!