Chapter 17
The financing system

In any vaguely reasonable system, banks must be exclusively nationalized, because the notion of private banks is heresy. Indeed, at the level of deposits from individuals, the guarantee is a social necessity, therefore bankruptcy of the bank is no longer socially conceivable. In addition, at the level of the financing of the activity, and of the households, defining to whom we lend and to what level is a fundamental element of economic and social policy, therefore a sovereign function. When the state abandons this function, it is forced to set up a gas plant with subsidy and rescue systems for endangered companies which is ultimately much more expensive and less efficient. On this point, the governments have apparently given up common sense for a few decades to liberal ideology and pressure from lobbies.

In the system we offer, the bank provides four basic services to individuals and organizations, namely the reliable accounting of the credit on each account, and the provision of the three forms of payment which are :
Direct payment, via a wallet credit card.
The bank transfer, via Internet.
The validation of payment requests received, always via the Internet, in place of the system that is currently called direct debit.

Then, the bank provides a noble service which is financing for organizations, and credit for individuals and organizations. The role of the bank is to allocate the funds to best respond to a specification that is fixed to it by what is currently called politics, but which in our system is gradually transferred to organizations, just like production. In other words, the noble role of the bank is to apply the strategy aimed at optimizing the social benefit to risk ratio.

This financing system ensures the unification between what is today called commercial enterprise, administration and solidarity economy oriented various kind of entreprises or associations. Indeed, an organization as we defined it in chapters 8 can play the economic and social role of all the entities that we have just mentioned. This is made possible by the fact that it is not bound to a positive financial result over time, and does not need capital since the bank can choose to lend to it, or to subsidize it.
The universal character of organizations in economic and social matters is therefore due to their ability to reconcile two characteristics. On the one hand, their capacity to maintain good operational efficiency over time, mainly due to their resilience to Parkinson's law (1). On the other, their facility to remain in the service of the general interest because of their non-dependence on private capital, therefore their non-dependence on private interests.

This banking service is provided by organizations of about a hundred people, as described in Chapter 8. Each true person or legal entity chooses his provider in one of the banking organizations, and can change it at wish, but can only have one at any given time. Non-bank organizations and other possible private companies are not entitled to credit, or sell insurance, neither to individuals, nor to other organizations or companies.
Symmetrically, true people and legal entities are no longer entitled to make financial investments. The reason is found in Chapter 4: an investment is a political act, because the sum of investments has a major structuring effect on economic activity, therefore to ensure respect for the common interest, investments should be the result of an in-depth reflection, which the citizens mainly do not provide when placing their savings. Our intention is not to limit individual freedoms, but simply to bring money back to its primary function as a medium of exchange, when it had become an object of accumulation and power "I lend you my money on condition that you ... ", of fetishism as Marx said.

The creation of organizations is done by a double spontaneous plus directed mechanism.
An individual can deposit a project with a bank, to obtain financing allowing the organization to start. It's the spontaneous side.
Existing organizations can publish calls for projects, which are collected, classified, and disseminated to the public and banks by specialized organizations. An individual can therefore strengthen his project or build it by responding to all or part of one or more calls for projects. It is the directed side.


An effective modernization of public services is not at all to apply to them modes of 'management' from the private sector, supposedly more efficient, which we saw with the article by Meyer and Rowan that they are only myths. Effective modernization of public services means setting up an effective system to fight against Parkinson's law. This implies that, in the absence of an alternative proposal, effective modernization of public services means transforming them into organizations as described in this book.