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offtopic:banking_and_finances_bill

Banking and Finances Act

Overview

Economics has always been a fuzzy area for His Administratorness' Government. Although the first Cabinet of AH.com included a Secretary of the Treasury, AH.com has never had an official currency or banking system of any kind. This act establishes the Imperial Bank of AH.com and an official currency, the Ianite Dollar.

History

LightInfa (E) submitted the bill for Parliament’s consideration on August 31, 2008. TheDarkServant (E) commented: “Whilst a currency may be needed, I have to say, I think this current system is leaving banking too political, If the Chancellor of the Exchequer gets to set the deciding vote. In my opinion, Politics and the Economy should mainly be seperate, we want economist heading for long-term goals rather than politicians using short-term economic boosts to get into power.”

09camaro (E) agreed with TheDarkServant (E) and proposed amending the bill to include: “that the central bank not be allowed to produce money with interest already attached. that it be non-profit, and attached with a total of 50% buy in into a stock exchange (if one is created). this way, the Bank will be able to be bought into by the people, which would increase the value of the dollar.”

LightInfa (E) disagreed with TheDarkServant's views on separating politics from the economy: “If the bank is non-political, then there is no real way for the government to influence the economy via the bank. The bank should be one of many tools for the government, and while the government will not have direct control, it should be able to pick the directors. I think its as apolitical as possible to leave the government's highest financial officer only having a deciding vote. He should have involvement in the Bank in one way or another.” LightInfa went on to say: “The government should not have too many holds over the central bank. The bank needs to be as independent as possible, and we cannot just tack on restrictions to it haphazardly.”

09camaro (E) responded: “But look at the central Bank of the US. it was developed by the big 4 tycoons in the Americas during a time when it wasnt needed. the tycoons created a scare that forced the economy to drop. and during the depression, the bank did nothing to help. they could have easily pulled back production on money to quell inflation. but they did nothing. i hate big governments. but it they do have to have control, then it should be much larger. it should be mostly tied into the government, or completely dependent upon the people. it should not be a higher power. it should not be 100% independent and the other two factors having no control what so ever.”

LightInfa (E) defended his position: “First of all, you say that we need increased government control because of what happened during the Great Depression. AH.com is not going to be facing a Great Depression-esque economic crisis during its existence. In addition, when you try to put too much government control, the effect is counter-productive. You say you hate big-government, this should be easy to understand. Too much control leads to people who are not economic professionals controlling the prime regulator of the economy. The Imperial Bank should be run by economic professionals who won't have politicians looking over the back every time they make a decision and who won't have politicians second-guessing every decision they make. They need to be able to make decisions freely and competently independent of the political apparatus. Regardless, the bank will not be completely independent anyway, as Parliament must confirm each Director and the Directors are ultimately chosen by the government, so the government can ensure that it picks competent individuals who are in line with the government's economic reasoning if need be.”

Susano (FFF) felt that the Parliament needed “something to fix the currency against. Otherwise inflation will run rampant, as the conrtol mechanism against it in the Offline World do not work here.” LightInfa (E) jokingly suggested the Zimbabwe dollar, but more seriously suggested fixing the value against the U.S. dollar.

VulcanTrekkie45 (YSP) announced he would support this bill if it included the amendments proposed by TheDarkServant (E) and 09camaro (E). President Sargon (E) also expressed an interest, stating, “This is a fascinating Bill. I shall watch it the development of it with interest. I would hope though that it doesn't become too complicated with the amendments people are bound to add, and require a degree in finance to understand.” Prime Minister Demosthenes (E) also announced support 09camaro's amendment, but initially withheld his support for the bill overall until he was able to propose his own amendments.

Later, Prime Minister Demosthenes (E) expressed approval of the bill's basic concept, but had a number of questions: “Clarification is needed– is the Chancellor of the Exchequer the head of the Office of the Treasury?” in regards to Section 1, “Where is the revenue achieved from?” and “Are we taxing Ah.com?” for Section 2, and lastly “What are the exact roles and responsibilities of the Chief Director, the Directors, and how that is different from the Chancellor of the Exch. Also, is this all under the Treasury office's jurisdiction?” He also felt the proposed 16-member Board of Directors for the Imperial Bank to be larger than necessary, “We dont want to make such an important function become a burocracy.”

The Prime Minister also suggested an amendment to Section Three: “…provided that no director be a member of the cabinet.”

LightInfa (E) clarified for the Prime Minister that the post of “Chancellor of the Exchequer” had previously be established by President Sargon (E). He also felt that the issue of taxation was “not under the purview of this bill” and “Taxing and placing tariffs are controversial by themselves, and trying to determine our source of revenue would be enough to probably prevent the other parts of this bill from passing. Such a matter needs to be discussed independently.” LightInfa (E) also defended his proposal for 16 Directors: “The only problem is that there are eight commenwealth realms under AH.com protection and each one of these territories needs to have an equal and independent voice in the bank to ensure that their regional interests and problems are represented. Anything less than 16 would overrepresent the territories in the Imperial Bank.”

LightInfa (E) also clarified the roles of the posts specified in the bill and their relationship with the Treasury office: “Use the analogy of the US Secretary of the Treasury and the Federal Reserve. The bank should be independent of the politics of the cabinet so it can make decisions independently. I have already described the role of the Imperial Bank itself, so the Board of Directors is responsible for carrying out the Bank's job. As I have said, the Bank is not part of the Office of the Treasury.”

LightInfa (E) also expressed fear the the Imperial Bank could grow out of control and, thus, should be limited in its scope to those roles suggested in the proposed bill. In regards to the Prime Minister's proposed amendment to Section Three: “If you're going to do that, you may as well extend it Members of Parliament as well.” Although hesitant, Prime Minister Demosthenes (E) ultimately withdrew his proposal, but also added: “Unless the 16 membership is brought down, I cannot give my support to this bill.”

At last, LightInfa (E) relented and agreed to shrinking the Board of Directors to ten members. The Prime Minister agreed to this and threw his full support behind the bill, urging all Evil Party MPs “to support it at once without any further amendment.”

Proposed Text of Legislation

Whereas AH.com has no official currency to conduct financial transactions with, allowing corruption of all types, and AH.com has no formal central bank, and whereas the current government operates on no official budget, allowing all possibilites of fraud and corruption;

Be it enacted by the 2009 Alternatehistory.com Parliament:

Section 1:

The official currency of AH.com will be the Ianite dollar (IDL). Each IDL will be subdivided into 100 alternates. Printing and minting of the currency will be under the jurisdiction of the Office of Treasury, with ultimate authority vested in the Chancellor of the Exchequer.

Section 2:

Every year, the President much submit an executive budget to Parliament. This budget must provide funds for the operation of each Ministry as well as the funds for any other functions that the president deems necessary. This budget may be amended by Parliament to its discretion, and the budget must receive a 2/3 majority to be passed.

In addition, Parliament must pass a budget to provide funds for its own needs every year. This budget will be ultimately submitted by the Prime Minister, but he must seek the advice of Parliament in authoring the budget. This budget also requires a 2/3 majority to pass Parliament.

Section 3:

The Imperial Bank of AH.com will be the central bank of AH.com. It will manage the supply of currency into and out of circulation, and it will also have the authority to regulate interest rates in the best interests of the economy. The Imperial Bank of AH.com shall be run by a Board of Directors consisting of sixteen Directors. Eight of the Directors will be representatives from the eight commenwealth territories of AH.com. These eight territorial representatives will be ruler/protector/viceroy, etc of the territory and must be confirmed by a simple majority in Parliament. The remaining eight directors will be chosen directly by Parliament and will be confirmed by a simple majority.

After all twelve directors have been confirmed, Parliament must further choose a Chief Director of the Imperial Bank. This Chief Director must be one of the twelve Directors confirmed earlier. He must be confirmed in the position of Chief Director by a 2/3 majority. The Chief Director will serve as the chairmen of the Board of Directors. In addition, he will be the face of the bank, representing the Imperial Bank at all public and governmental events.

The Chancellor of the Exchequer will be a secondary member of the Board of Directors, sitting in at all meetings and having the right to speak. He will not normally have the right to vote on any decisions within the Board of Directors, but he may cast a vote in the case of a tie.

Proposed Amendments

Proposed Amendment: The Central Bank shall not be allowed to produce money with interest already attached, shall be non-profit, and attached with a total of 50% buy in into a stock exchange (if one is created).

Proposed Amendment to Section Three: The remaining eight directors will be chosen directly by Parliament and will be confirmed by a simple majority, provided that no director be a member of the cabinet. (Withdrawn)

Final Text of Legislation

Whereas AH.com has no official currency to conduct financial transactions with, allowing corruption of all types, and AH.com has no formal central bank, and whereas the current government operates on no official budget, allowing all possibilites of fraud and corruption;

Be it enacted by the 2009 Alternatehistory.com Parliament:

Section 1:

The official currency of AH.com will be the Ianite dollar (IDL). Each IDL will be subdivided into 100 alternates. Printing and minting of the currency will be under the jurisdiction of the Office of Treasury, with ultimate authority vested in the Chancellor of the Exchequer.

To establish a backing for the IDL, a committee of four members, two EVIL, one YSP, and one FFF, to be appointed by the respective party leaders, will examine possible backings for the currency/real-life currencies that the IDL could be pegged to. After two-weeks of deliberation, they shall submit their recommendation to Parliament in the form of a bill establishing backing for the IDL.

Section 2:

Every year, the President much submit an executive budget to Parliament. This budget must provide funds for the operation of each Ministry as well as the funds for any other functions that the president deems necessary. This budget may be amended by Parliament to its discretion, and the budget must receive a 2/3 majority to be passed.

In addition, Parliament must pass a budget to provide funds for its own needs every year. This budget will be ultimately submitted by the Prime Minister, but he must seek the advice of Parliament in authoring the budget. This budget also requires a 2/3 majority to pass Parliament.

Section 3:

The Imperial Bank of AH.com will be the central bank of AH.com. It will manage the supply of currency into and out of circulation, and it will also have the authority to regulate interest rates in the best interests of the economy. The Imperial Bank of AH.com shall be run by a Board of Directors consisting of ten Directors. Each Director must be chosen by Parliament, and then confirmed by a simple majority.

After all ten directors have been confirmed, Parliament must further choose a Chief Director of the Imperial Bank. This Chief Director must be one of the twelve Directors confirmed earlier. He must be confirmed in the position of Chief Director by a 2/3 majority. The Chief Director will serve as the chairmen of the Board of Directors. In addition, he will be the face of the bank, representing the Imperial Bank at all public and governmental events.

The Chancellor of the Exchequer will be a secondary member of the Board of Directors, sitting in at all meetings and having the right to speak. He will not normally have the right to vote on any decisions within the Board of Directors, but he may cast a vote in the case of a tie.

Also, each AH.com territory may send one representative to the Board of Directors who has speaking privileges, but he does not have voting privileges.

Results

Voting on this bill began on August 31, 2008 and closed on September 7, 2008.

Prime Minister Demosthenes (E), LightInfa (E), 09camaro (E), TheDarkServant (E), LordInsane (E), Ran Exilis (E), Gladi (E), Susano (FFF), and Keenir (E) voted IN FAVOR.

NONE voted AGAINST.

Haggis (E), Opposition Leader Kidblast (YSP), Nekromans (YSP), VulcanTrekkie45 (YSP), Pkmatrix (YSP), and Steffen (FFF) did not vote.

Thus, the Banking and Finances Act was passed by Parliament by a vote of 8 in favor, none against, and 6 abstaining.

On January 26, 2009, Pkmatrix (YSP) announced that, despite the voting having ended four months earlier, he was opposed to this bill and urged President Sargon (E) to veto it. Sargon responded on January 27: “As for the Banking and Finances Bill, I do happen to find it fiendishly complicated and very long indeed. Plus it makes my job less fun and more of a headache. I would have preferred something more simple and less wordy, although I feel it is an interesting idea. Nevertheless, it has been voted for by an overwhelming majority which I'd rather not go against here, so I hereby sign it into law.”

See Also

offtopic/banking_and_finances_bill.txt · Last modified: 2019/03/29 15:13 (external edit)